Preamble

The House met at half-past Two o'clock

PRAYERS

[MR. SPEAKER in the Chair]

PRIVATE BUSINESS

ST. GEORGE'S HILL, WEYBRIDGE, ESTATE BILL INTERNATIONAL WESTMINSTER BANK BILL (By Order)

Orders read for consideration of Lords amendments.

To be considered on Thursday 27 July.

ASSOCIATED BRITISH PORTS (No. 2) BILL (By Order)

Order read for resuming adjourned debate on Question—[23 May]—That the Bill be now read the Third time.

Debate to be resumed on Thursday 27 July.

BRITISH RAILWAYS (PENALTY FARES) BILL [Lords] (By Order)

Order for further consideration, as amended, read.

To be, further considered on Thursday 27 July.

BUCKINGHAMSHIRE COUNTY COUNCIL BILL [Lords] (By Order)

LONDON LOCAL AUTHORITIES BILL [Lords] (By Order)

LONDON REGIONAL TRANSPORT (PENALTY FARES) BILL [Lords] (By Order)

BRITISH RAILWAYS BILL (By Order)

BROMLEY LONDON BOROUGH COUNCIL (CRYSTAL PALACE) BILL (By Order)

Orders for consideration, as amended, read.

To be considered on Thursday 27 July.

LONDON UNDERGROUND (VICTORIA) BILL (By Order)

BRITISH FILM INSTITUTE SOUTHBANK BILL (By Order)

VALE OF GLAMORGAN (BARRY HARBOUR) BILL [Lords] (By Order)

Orders for Second Reading read.

To be read a Second tune on Thursday 27 July.

Oral Answers to Questions — NORTHERN IRELAND

Security

Mr. Duffy: To ask the Secretary of State for Northern Ireland if he will make a statement on the security situation in Northern Ireland.

Mr. Bellingham: To ask the Secretary of State for Northern Ireland if he will make a statement on the current security situation.

The Secretary of State for Northern Ireland (Mr. Tom King): Since I last answered questions on 22 June there have been four deaths in Northern Ireland arising from the security situation. In addition, the Provisional IRA has claimed that it murdered the business man abducted in county Louth on 16 July.
The security threat remains at a high level, but the resolute efforts of the security forces continue to yield results. So far this year, 161 people have been charged with serious offences, including 18 with murder and 31 with attempted murder. More than 200 weapons, almost 27,000 rounds of ammunition and approximately 600 lbs of explosives have been recovered in Northern Ireland. I understand that the Garda Siochana has recovered 60 weapons, approximately 15,000 rounds of ammunition and a substantial quantity of explosives.
The House will be aware of recent arrests which flowed directly from the close international co-operation with the Irish, French and United States authorities, and for which we are most grateful.

Mr. Duffy: The Secretary of State should be congratulated on his humanity and political courage in announcing the release of 19 paramilitaries on licence over the next nine months. Can he offer any hope to the families of those not included? Does he think that a similar move by the Republic in respect of Portlaoise might be helpful, and will he consider mentioning that to the new Irish Foreign Minister, Mr. Collins, when he next meets him?

Mr. King: I think that that was a two-part question. In response to the first part, I hope that hope is offered to other families by the actions that we have proposed in respect of these prisoners. Those familiar with prison matters will know of the significant impact of the Christmas leave arrangements, and we are examining the matter carefully to see whether that approach can offer further possibilities. I should like to think that there has been a significant impact from that and from our announcements about releasing some people on licence. I take a very sympathetic view towards some of the young people who got caught up in such activities early in their lives and who are serving substantial sentences. I have a very unsympathetic view of those who re-offend and become re-involved. They cannot expect the same sort of sympathy.
I shall not answer the second part of the hon. Gentleman's question, in which he invited me to advise the Irish Government on their prisons policy, although I note that there have been some comments in Irish newspapers.


Obviously, every case is different. I know how difficult the cases are and I know that the Irish Government are aware of our approach in these matters.

Mr. Bellingham: Does my right hon. Friend agree that the recent arrests in America, France and Dublin may represent a fresh resolve in those countries to combat terrorism? Does he also agree that the recent murder of Mr. McAnulty—presumably because he refused to pay protection money—was particularly vile and evil? Is it not heartening that that incident was condemned by so many people in South Armagh, including Thomas O'Fiaich?

Mr. King: That illustrates clearly our common interest in defeating the evil of terrorism. That gentleman was abducted in the Republic and almost certainly murdered in the Republic, and his body was then dumped north of the border, to cause maximum difficulties for the RUC and the Garda in the investigation of and prosecution of those responsible for the crime. I certainly join my hon. Friend in condemning that appalling crime. I welcome too, the very rapid condemnation that came from all concerned. The hon. Member for Newry and Armagh (Mr. Mallon), Cardinal O'Fiaich and a whole range of other people were outspoken in their disgust at that murder.
I am grateful to my hon. Friend for what he said about the value of international co-operation. I have had to stand at the Dispatch Box for long enough being jeered at by people who said that no one would co-operate with us, especially the Irish Government. I had hoped that some of those people, who were so ready to criticise, would be prepared to stand up today and admit the value of that co-operation and the real contribution of the Irish Garda, not only in arrests, but in the speed of the transfer of information to the French authorities. We are also grateful for the speed of their reaction.

Mr. Molyneaux: In view of the 50 per cent. increase in serious terrorist offences in the frontier zone covered by 3 brigade in the year since that brigade was formed, will the Secretary of State consider increasing the numerical strength of all arms of the security forces in that zone?

Mr. King: I do not recognise the statistics that the right hon. Gentleman has chosen to quote. However, I would have hoped that, in response to what I have said, he would feel able to pay tribute to the valuable co-operation, which has undoubtedly contributed significantly to the saving of lives of his constituents and many others. One cannot over estimate the value of that co-operation, which is important if we are to defeat the evil of terrorism that is a threat to people north and south of the border.

Rev. Ian Paisley: Will not the Secretary of State admit that it is the duty of every democratic Government to co-operate in the fight against terrorism? No democratic Government should think that they are going out of their way or should get laurels for so doing.
Is the Secretary of State aware of the serious concern of ordinary individuals in the neighbourhood about the removal of the Army post at Lacky Bridge which was promised to widows who visited the Prime Minister some 11 years ago? Did the Royal Ulster Constabulary agree to the removal of that Army post? If so, is it the beginning of the removal of other posts in that border area?

Mr. King: As the hon. Gentleman knows very well, I have made it clear that there are no proposals for any

further removals of vehicle border checkpoints of that kind. Those are operational matters; the decision was taken by the security forces and has been implemented. We are certainly keen to ensure the best possible protection for everyone in the Province against the danger of terrorism.
On the value of international co-operation—I am not talking just about the Irish Government, but about the United States Government, too—it is no good saying, "Keep a checkpoint", and ensuring that we stay as we are. It is also important to find the terrorists and to discover their lines of supply. It is important to stop any technical developments that may be a direct threat to all the security forces in Northern Ireland, and to the hon. Gentleman's constituents, in the battle that we fight. I would have hoped to hear him, too, pay some tribute to the value of international co-operation.

Mr. Mallon: Is the Secretary of State aware that senior officers of the Ulster Defence Regiment are using a public relations and information video which is explicitly critical of my party? Does he agree that no section of Government information services should be used in such an overtly party political way? Will he assure the House that that video will be removed from use?

Mr. King: I have no knowledge of the video to which the hon. Gentleman refers, but in general I do not dissent from the proposition that he has put forward. I shall certainly have the matter looked into.

Republic of Ireland

Mr. Canavan: To ask the Secretary of State for Northern Ireland what subjects he expects to discuss at his next meeting with representatives of the Government of the Republic of Ireland.

Mr. Tom King: The agenda for the next meeting of the conference has not yet been finalised, but I expect it to include security matters; recent and forthcoming events; the scope for greater cross-border economic co-operation; the progress made on fair employment; and other matters.

Mr. Canavan: What is the likely effect on the British-Irish talks and on Britain's reputation throughout the world when the British soldier who killed an innocent young man, Aidan McAnespie, is simply given a token fine and returned to normal duties, and when the British Government refuse reasonable demands from respectable organisations such as Amnesty International for a full judicial inquiry into that disputed killing and into the SAS killings of three unarmed people in Gibraltar?

Mr. King: I do not know whether the hon. Gentleman bothered to study the facts before seeking to make such outrageous allegations. He may not be aware that the matter was investigated, not only as the absolute requirement on which I insist and as the absolute practice, by the RUC in a full criminal investigation, but on this occasion by the deputy commissioner, now the commissioner, of the Garda on behalf of the Irish Government. On this exceptional occasion, they wished to investigate, too. As no evidence was forthcoming, on either side of the border, that the incident was anything other than an accident, I am appalled that the hon. Gentleman chooses to raise the matter in this way.

Mr. William Ross: As Mr. Haughey has just made it plain that he is not very much in favour of summits of any sort, does the Secretary of State consider it advisable to follow his admirable advice and example?

Mr. King: The Taoiseach said that he found meeting the Prime Minister twice a year, on the occasions of the normal European summits, to be a perfectly satisfactory arrangement. That is sensible because we now have a close working relationship. Here we go again. On the very day when any sensible person can see, before his or her eyes, the obvious benefits of co-operation in the fight against terrorism, there is a deliberate determination not to do anything except to frustrate co-operation. The backwoodsmen are coming out from the Opposition Back Benches with their reactionary views.

Mr. Gow: What objections do Ministers in the Irish Government have to conferring modest additional powers on the 26 district councils, to setting up a regional council with widely devolved powers over local matters and to legislating in this House for Northern Ireland in the same way as we legislate for the rest of the kingdom?

Mr. King: These are internal matters for the Republic. In the Dail yesterday, the Taoiseach made it clear that matters relating to the administration and government of Northern Ireland are primarily for the parties in Northern Ireland to determine. Although I have some sympathy with looking further at some of my hon. Friend's ideas on giving greater powers to local authorities, I must advise him that the behaviour of one or two councils—Belfast is one—does not encourage one down that route.

Mr. McNamara: The Secretary of State sounds remarkably demob-happy this afternoon. We do not dissent from many of the opinions that he has expressed. Although I did not intervene on the previous question to comment on his important statement about international co-operation in the fight against terrorism, I am sure that hon. Members of all parties will warmly welcome it.
I should like to ask the right hon. Gentleman about the Anglo-Irish review. We do not know how many further intergovernmental conferences the right hon. Gentleman will be attending, but he mentioned a number of important items that are likely to be on the agenda, not least economic co-operation on both sides of the border. Does the Secretary of State think that both Governments might consider issuing position papers or Green Papers so that there can be a general informed debate on both sides of the border among people who might not otherwise want to be associated with the Anglo-Irish review, but who should at least know what is going on so that there can be input from all sides?

Mr. King: In response to the hon. Gentleman's first point, I knew that, whatever my aspect at the Dispatch Box, somebody would read something into it. If I sound enthusiastic about the progress that we are making in international co-operation in the fight against terrorism, perhaps some hon. Members will understand just how important were the arrests made during the weekend. I cannot overstate that, and I am grateful to the hon. Gentleman for what he said about it.
I am ready to support sensible discussion on making political progress by means of background papers and so

on, but we have made it clear that the first stage must be discussion with elected people within Northern Ireland to establish the most promising areas for development.

Student Loans

Mr. Barron: To ask the Secretary of State for Northern Ireland if he will make a statement on the progress of the introduction of student loans.

The Parliamentary Under-Secretary of State for Northern Ireland (Dr. Brian Mawhinney): Arrangements for the introduction of top-up loans for Northern Ireland students are proceeding in parallel to those in Great Britain.

Mr. Barron: Does the Minister share the view of the Secretary of State for Education and Science that student loans are excellent and offer good value for money? If so, what does he think of the estimate of the Government's consultants, Price Waterhouse, that the scheme will cost £100 per debtor to administer, and the estimate made by Dr. Nick Barr of the London School of Economics that it will take 100 years before the cost of the scheme is recouped?

Dr. Mawhinney: Of course, I agree with my right hon. Friend. As the hon. Gentleman takes an interest in these matters, he will know that those views are not shared by the Department of Education and Science.

Mr. Harry Greenway: What proportion of the extra 200,000 students in higher education now, compared with in 1979, come from Northern Ireland, and how much does the average student in higher education in Northern Ireland borrow?

Dr. Mawhinney: There has been an increase in university students in Northern Ireland and my hon. Friend will be pleased to know that the participation rate in Northern Ireland universities is 20 per cent., compared with 15 per cent. in Great Britain. That is a reflection of the high standing of Queens university and the university of Ulster.

Mr. Beggs: I congratulate the Secretary of State on the confidence that he exhibited at the Dispatch Box today, which may be due to the recent success, but one swallow does not make a summer. Perhaps, there are promises of promotion in the wind. However, the right hon. Gentleman is to be congratulated on his performance so far.
Is the Minister aware of the widespread concern in Northern Ireland that many able students may not benefit from higher education because of the freezing of the student grant and the introduction of the loans scheme? There is particular concern among medical students, who study for 45 weeks of the year for five or six years, with little time to work in the holidays to earn additional income. I hope that the Government will reconsider the scheme and encourage the thrifty use of grants rather than introduce students to the burden of debt and the further anxiety that that would entail.

Dr. Mawhinney: We are the only developed country with no system of top-up loans alongside grants. The Government have a responsibility to find a balance between benefits to students and the cost to the taxpayer. In 1984, the latest year for which figures are available,


support for students in the United Kingdom cost about £750 per annum. In France it was £180; in West Germany, £70; and in Japan, £30. If that does not represent a disincentive in those countries, I fail to see why there should be any disincentive in the United Kingdom or in Northern Ireland.

Mr. John Marshall: Does my hon. Friend agree that the loans scheme will be particularly welcome to students who do not receive the full assessed parental contribution? Does he also agree that since graduates can look forward to much larger incomes than the community at large, it is only right that they should repay to society part of the benefits that they are getting from their university education?

Dr. Mawhinney: My hon. Friend is right on both points. About 120,000 university students receive no grant at all because they are means-tested out. About 50,000 receive no mandatory grant and about 160,000 receive only partial grants. All those students stand to benefit from the introduction of top-up loans. My hon. Friend will agree that the introduction of those loans at a nil real interest rate is a further incentive.

Mr. Flannery: Does the Minister realise that the introduction of loans will be a disincentive to entering higher education? The last time that Britain had a loan system was before the war. We do not have to follow blindly countries such as West Germany, because we have about £100 billion from North sea oil. Will not many young people be detered from becoming students? If they become students will they not leave their studentship in debt? It took me four years to pay back my debt.

Dr. Mawhinney: I know that the hon. Gentleman finds facts uncomfortable, but nevertheless the fact is that loan schemes do not act as disincentives in other countries. The hon. Gentleman fails to make an argument for why this country should be any different.

Ms. Mowlam: Is it not difficult for the Minister to accept facts? Does he accept that the study by Dr. Barr mentioned by my hon. Friend the Member for Rother Valley (Mr. Barron) stated clearly that when students complete a three-year course they will have a minimum debt of £7,000? Does not the study by Price Waterhouse which was commissioned by the Government show that when half the students graduate by 1995 they will either default or defer on their debts? Is that opening up higher education and increasing access, or will it achieve the exact opposite?

Dr. Mawhinney: Norway has a default rate of 1 per cent. and Sweden and Japan a default rate of 2 per cent. Although there is no loan system at present, the statistics show that the projected levels of borrowing outlined in the White Paper are less than the exact borrowing figures in countries that have loan schemes. The hon. Lady's information and facts simply do not impress me.

Single European Market

Mr. Ashdown: To ask the Secretary of State for Northern Ireland what provisions the Government are making for the impact of 1992 on the economy of Northern Ireland; and if he will make a statement.

The Parliamentary Under-Secretary of State for Northern Ireland (Mr. Peter Viggers): The Government have promoted and supported a wide range of measures intended to inform Northern Ireland business of the challenges and the opportunities which arise from the creation of the single European market.

Mr. Ashdown: As the Secretary of State's ebullience at the Dispatch Box appears to be a feature of questions, may I say that if he were not to be at Northern Ireland questions in the future, I and many hon. Members would want to express our admiration for the way that he has done his job over the years?
Does the Minister agree that there is widespread anxiety in Northern Ireland, and in Ireland as a whole, that closer integration following 1992 may cause problems for the Irish economies, as they are positioned on the peripheries of the European Community? That may be exacerbated by the Channel tunnel if there is no infrastructure to back it—[Interruption.] Would it be worth while—[HON. MEMBERS: "Question."]

Mr. Speaker: Order. I think that the right hon. Gentleman is coming to his question.

Mr. Ashdown: As the constitutional parties appear reluctant to discuss political matters, but keen to discuss economic matters, could the Government facilitate a round table discussion on how Northern Ireland might face the challenges and opportunities of Europe in 1992?

Mr. Viggers: I do not share the right hon. Gentleman's gloom. Northern Ireland has many attributes, including the availability of a young, well-educated work force, the quality of its infrastructure and telecommunications and the quality of its environment, all of which have been recognised by a number of prospective inward investors. We have persuaded inward investors from inside and outside Europe to invest in Northern Ireland, and I think especially of Montupet of France and Daewoo from South Korea.
We had useful discussions with the Republic of Ireland at a round table meeting during the Louvain conference in Belgium in September 1988. I was thinking of suggesting a further conference along those lines.

Mr. Kilfedder: Although business progress and prosperity are important in Northern Ireland, is the Minister aware that the cost of living is higher there than in the rest of the United Kingdom, as exemplified by Northern Ireland's high cost of transport, food, bread and electricity? That makes life difficult for many people in Northern Ireland—particularly poor, old age pensioners. What improvements will be made before 1992?

Mr. Viggers: The hon. Gentleman would want the record to be complete. Some items are much cheaper in Northern Ireland than elsewhere in the United Kingdom. I am thinking particularly of housing. The hon. Gentleman's point about bread is well taken. Recently, there was an in-depth study of that issue, and I believe that the hon. Gentleman has a question about it on the Order Paper, albeit to another Minister. I share his view that the high price of bread in Northern Ireland should cause us concern. We encourage the availability of competitive bakery products, to ensure that the consumer has the best choice.

Mr. Hume: Does the Minister agree that the major economic impact of 1992 on Northern Ireland will be the five-year strategic plan funded by the EEC, which is already the subject of detailed discussions between the Government and the authorities in Brussels? When do the Government intend to let the Northern Ireland public and local interests know about the specific projects contained in that plan, so that there can be proper and thorough public discussion and consultation?

Mr. Viggers: The Northern Ireland regional development plan was submitted in March to the European community and—bearing in mind that Northern Ireland is an objective I region in Europe, and therefore will be given a degree of priority—we have made further proposals. One area of priority is support for port, airport, rail and road facilities, to ensure that Northern Ireland does not miss out in 1992.

Mr. Nicholas Baker: What substantial extra provision for hospitals, industry, schools and so on, will the Government need to make for the impact of 1992 on Northern Ireland's economy if Northern Ireland accepts its share of the 3·25 million Hong Kong Chinese that the right hon. Member for Yeovil (Mr. Ashdown) wants the United Kingdom to admit under his misguided proposals?

Mr. Viggers: If my answer were to go into great detail, I suspect that I would be out of order. A notable contribution to Northern Ireland's economy has been made by the immigrant community, particularly the Indians and Chinese. We make no secret of the fact that we welcome inward investment in Northern Ireland.

Mr. Clifford Forsythe: What action is the Minister taking to improve the marketing of Northern Ireland products in the EEC?

Mr. Viggers: There has been a considerable switch of emphasis away from standard capital grants and the availability of standard grants to selective financial assistance, which takes the form not only of the aptly named selective financial aid within the Industrial Development Board but a range of marketing schemes—particularly the 40/30 and the 40/60 schemes available from the IDB and the Local Enterprise Development Unit. Northern Ireland's best companies are excellent at marketing, but others must be encouraged to sink more effort into marketing outside Northern Ireland.

Mr. Hayes: Is my hon. Friend greatly encouraged that unemployment in the Province continues to fall? Will he continue to convey loud and clear the message to potential investors that, despite the troubles, the Province is still the most law-abiding part of the United Kingdom, that it is a great place in which to invest, and that it will offer great opportunities to all in 1992?

Mr. Viggers: I am grateful to my hon. Friend for his remarks, and I endorse them all. We are delighted that unemployment has fallen so much. At 104,000, it is still far too high, but it is way below the headline figure of 134,998 in October 1986. We have persuaded inward investors that Northern Ireland is a good place to do business, and those already there like it very much.

Mr. Jim Marshall: Does the Minister agree that there are obvious attractions in treating the island of Ireland as a single economic entity? When will he make a statement

on the Government's discussions with the Republic on co-operation in the sphere of tourism? Does he expect that the Government will encourage further co-operation between the Province and the Republic in agriculture?

Mr. Viggers: I made a statement on tourism some two weeks ago in which I explained that there is indeed co-operation between the Government, the Northern Ireland Tourist Board and Bord Failté. It would be foolish of us not to co-operate, bearing in mind that only one in 15 of visitors to the Republic go up to Northern Ireland and it would be easy to encourage more to do so.
I have no further announcement to make on tourism co-operation, nor am I in a position to comment on agriculture, which is outside the remit of this question.

Short Brothers

Mr. Cran: To ask the Secretary of State for Northern Ireland if he will make a further statement on the privatisation of Short Brothers plc.

Mr. Viggers: Since the announcement on 7 June of heads of agreement whereby Bombardier of Canada will acquire Shorts, good progress has been made on the necessary legal documentation. I am pleased to inform the House today that approval to the terms of the transaction has been given by the European Commission. It is our intention to complete the transaction in September.

Mr. Cran: Does my hon. Friend agree that the public purse facilitated—quite rightly—the takeover of Shorts by Bombardier, in the form of sales worth £762 million, and that the quid pro quo is that the House and the taxpayer are entitled to know how much Bombardier will contribute towards investment in the company? Can my hon. Friend tell us the amount specified in the corporate plan? If he cannot be specific, why?

Mr. Viggers: The details of the agreement between the Government, Shorts and Bombardier are matters of commercial confidentiality. I can, however, tell my hon. Friend that Bombardier will be making a substantial investment in Shorts—supported, of course, by Government assistance. The cost of the transaction, some £750 million, has been projected by some as the cost of privatisation, but I think that my hon. Friend will realise that the reverse is true. All but £115 million is the cost of the company in public ownership and the cost of outstanding contracts. That sum will go to support further investment in Shorts.

Mr. A. Cecil Walker: Is the Minister aware of the deep public concern in Northern Ireland about job losses that have occurred at Harland and Wolff since privatisation? Can he give us any assurance that such job losses will not occur in the privatisation of Short Brothers, and can he give us any guarantee that jobs there will be secure?

Mr. Viggers: The long-term future of employment at Shorts will depend on the profitability of the company and on its ability to deliver, on time, high-quality products that people wish to buy. I believe that the deal between Shorts and Bombardier is the best possible framework for that to happen.
I can assure the hon. Gentleman that there are no plans for further redundancies at this point. Let me draw to his attention the fact that when Bombardier acquired


Canadair it acquired a loss-making company with 5,000 employees; it now owns a profitable company employing 6,500. We hope that the same will apply at Shorts.

Mr. Peter Robinson: What share might Shorts expect of the Canadian company's regional debt programme?

Mr. Viggers: I cannot answer that question precisely, but I can assure the hon. Gentleman that, having visited Bombardier in Montreal last month, I am very impressed by the fit between Shorts and Bombardier. I will write to the hon. Gentleman on the details.

Mr. McGrady: While all the communities in Northern Ireland welcome this vast investment in Shorts, it is important that both communities share in that prosperity. Is the Minister aware that the rate of recruitment from the Catholic population fell from 17 per cent. in the second monitoring period in 1983 to 14 per cent. in the third monitoring period of 1984? That trend is not welcomed by those whom we represent. Will the Minister ensure that the new company adopts proper recruitment procedures based on fair employment principles?

Mr. Viggers: The new company will indeed respect the application of fair employment in Northern Ireland. I can update the hon. Gentleman's information by telling him that the latest available figures for 1988 show that 19 per cent. of Short's recruits were Catholics. [Interruption.]

Mr. Speaker: Order. I ask hon. Members to desist from private conversations in the middle of these important questions.

Disabled Persons (Northern Ireland) Act

Rev. Martin Smyth: To ask the Secretary of State for Northern Ireland whether he has yet considered implementation dates for the Disabled Persons (Northern Ireland) Act 1989; and if he will make a statement.

The Parliamentary Under-Secretary of State for Northern Ireland (Mr. Richard Needham): The Act will be implemented in stages as resources become available.

Rev. Martin Smyth: In so far as we have combined health and social services boards has the Minister any plans to implement those stages faster in Northern Ireland than they have been implemented in the rest of Britian, especially in the light of recent changes?

Mr. Needham: We start three years behind the Act here, and we shall implement it as quickly as we can. We look to implement sections 9, 10 and 11, except (4) and section 12 by the end of this year. We shall implement section 4, except (b), sections 5, 6, 8 (1) and section 11 (4) as soon into next year as we can. We shall have to consider with the Boards the cost implications of remaining sections.

Mr. Bill Walker: Is my hon. Friend aware that in the rest of the United Kingdom disabled people are looked after substantially by local authorities? If Rangers can sign a Catholic football player, is it not about time that we gave Northern Ireland the same local government as the rest of the United Kingdom?

Mr. Needham: We have for a long time had integrated social services and health boards. That system is working extremely well. We are spending considerable sums on

community care and we shall continue to operate an integrated system which works satisfactorily for the community in Northern Ireland.

Mr. Tom Clarke: While congratulate the hon. Member for Belfast, South (Rev. Martin Smyth) on piloting such an important Act on to the statute book, will the Minister offer inspiration to the rest of the United Kingdom by ensuring that the Act is properly and fully implemented and in so doing that community care ceases to be community neglect?

Mr. Needham: I always like to offer inspiration to everyone. We are implementing the Act in Northern Ireland as fast as we can. We started behind and we have to work out with the boards exactly what the costs are. At present I cannot go further than that.

Mr. Alton: Given the Government's ability to publish figures about the denominational make-up of employees in Shorts, does the Minister think that it is reasonable to publish figures for the number of disabled people working in the Northern Ireland Office and in local government in the Province? Can he tell the House how many disabled people are employed by the NIO?

Mr. Needham: I cannot, but I shall find out and write to the hon. Gentleman. Our policy on disablement in Northern Ireland bears cognisance and competition with any other part of the United Kingdom and we are extremely proud of it.

Cohn Wallace

Mr. Dalyell: To ask the Secretary of State for Northern Ireland if in the light of allegations in the book "Who Framed Colin Wallace?", he will allow independent inspection on Privy Councillor terms of the records of his Office relating to contacts with Colin Wallace.

The Minister of State, Northern Ireland Office (Mr. Ian Stewart): No, Sir.

Mr. Dalyell: What on earth is there to hide from Privy Councillors? Did the Minister notice that in the review by R. W. Johnson, a fellow of Magdalen college, Oxford, it was highlighted that Cohn Wallace offered to give evidence to the Hughes inquiry on condition of immunity from prosecution under the Official Secrets Act and, according to that fellow of Magdalen, it was turned down by the Prime Minister personally? Will the Minister ask the Prime Minister whether that is true? She is sitting next to him.

Mr. Stewart: Mr. Wallace was given assurances that he would not be prosecuted under the Official Secrets Act if he gave evidence to the Terry and Hughes inquiries. No matter how many questions the hon. Gentleman asks, no evidence has been found in many thorough investigations of the case to substantiate the allegations which Mr. Wallace has made over many years.

Republic of Ireland

Mr. Latham: To ask the Secretary of State for Northern Ireland whether he will make a statement on his most recent discussions with Ministers of the Republic of Ireland.

Mr. Tom King: I last met representatives of the Government of the Republic of Ireland at the meeting of the intergovernmental conference in Belfast on 24 May. At that meeting, we completed the review of the working of the conference. Copies of the joint statement issued afterwards and the communiqué were placed in the Library.

Mr. Latham: Is it not significant—and may this not arise as a result of the better relations with the Government of the Repulic—that there was a sharp fall in the vote for Sinn Fein in recent elections in both north and southern Ireland?

Mr. King: It is significant that the vote for Sinn Fein in the Republic fell from 1·9 to 1·2 per cent., and in the European elections in Northern Ireland, the vote of the Sinn Fein candidate almost halved. Those are significant developments. On the political and security fronts, as well in the economic sphere, we see the value of working together. The events of the last weekend show all too clearly the value of having the closest possible co-operation in the security sphere.

Ms. Short: Does the Secretary of State believe that in the current situation in Ireland it might be possible to obtain a ceasefire? Does he agree that that would be the biggest gain for the people of Ireland, in the North and the South, and will he have serious discussions with the Irish Government about the possibility of achieving that?

Mr. King: The ending of violence in the island of Ireland is the greatest ambition that anybody could possibly have. One side is perpetrating the violence. There is an easy way to achieve the hon. Lady's request, and that is to desist from the use of violence. There is one way by which the desire for it could be publicly tested. It is clear, as the elections in the Republic showed, that Left-wing parties can secure a substantial number of votes if they repudiate violence. Those who insist on perpetrating violence were repudiated by the electors, north and south of the border.

Oral Answers to Questions — PRIME MINISTER

Health and Safety

Mr. William Powell: To ask the Prime Minister if she has received recent representations regarding health and safety legislation.

The Prime Minister (Mrs. Margaret Thatcher): Our excellent legislation has provided a model for many European Community proposals. On the latest available figures, standards of enforcement in the United Kingdom are among the highest in Europe, and the level of accidents among the lowest.

Mr. Powell: Will my right hon. Friend confirm that according to the latest figures available, the number of fatalities in industry in Britain is the second lowest after the Netherlands of EEC countries, that our record is four times better than that of France, six times better than that of West Germany and more than seven times better than that of Italy? Does that not suggest to my right hon. Friend that they may have something to learn from what is taking place in this area in this country?

The Prime Minister: Yes. On the latest available figures, our record in health and safety is extremely good. So also is that of the Netherlands, Denmark and Belgium. Other countries are not quite so good as ours. We are proud of our record and when I took our social charter to Europe, I had some material information about our record on health and safety and it was very favourably received.

Mr. Bell: Is the Prime Minister aware that during the current docks dispute, middle management on Teesside are driving cranes and in doing so may be in breach of health and safety regulations applying to the docks? Is she aware that representations have been made to the docks inspectorate about the matter? Does she agree that it would be wrong for people seeking to break a strike to break the health and safety regulations at the same time? Which comes first, safety or strike-breaking?

The Prime Minister: As the hon. Gentleman knows full well, health and safety always come first. If he has evidence, I am sure that he will give it to the inspectors so that they can take the necessary action.

Mr. Marlow: What action is being taken by Her Majesty's Government to ensure that those decisions which should be taken on health and safety within the United Kingdom, and not at the European level, are in future taken within the United Kingdom? For example, what has it got to do with the European Commission as to the quality of water that comes out of the taps in Northampton, Sunderland and in other parts of the United Kingdom?

The Prime Minister: As my hon. Friend will know, under the Single European Act, certain directives and decisions can be taken by majority. It is in our interests that some decisions should be taken by majority because we have been able to ensure that other countries accept standards which they might not wish to have applied by outvoting them.
As for the water measures, we are coming up to most of the standards, as my hon. Friend will be aware. Indeed, the Secretary of State for the Environment has done a superlative job of work on water legislation and standards.

Engagements

Mr. Mallon: To ask the Prime Minister if she will list her official engagements for Thursday 20 July.

The Prime Minister: This morning I presided at a meeting of the Cabinet and had meetings with ministerial colleagues and others. In addition to my duties in the House, I shall be having further meetings later today.

Mr. Mallon: I am sure that many right hon. and hon. Members will agree with me that the French Prime Minister, Michel Rocard, got it wrong when he accused the Prime Minister of social cruelty. When the right hon. Lady comes to assess the effects of chronic unemployment, the poll tax, the Government's butchery of the Health Service and the cuts in social security, which she has presided over like a latter day Marie Antoinette, will she be able to accept that the phrase "social cruelty" was a mild understatement which should have read "social butchery"?

The Prime Minister: The hon. Gentleman is aware that the Health Service in Northern Ireland is far better than it has ever been under any Administration—far, far better. It


is a pity that hon. Members are not prepared to recognise the facts. For every £1 spent under Labour, £3 is spent on the Health Service under the Conservatives, and last year an extra £2 billion was allocated to it.
The community charge is a far fairer way of paying for a proportion of local government expenditure than any rating revaluation since 1972 would have been, and it is far fairer than the Opposition's alternative of capital valuation accompanied by local income tax which would be infinitely worse for everyone.

Civil Defence

Mr. John Browne: To ask the Prime Minister if she has received recent representations regarding civil defence.

The Prime Minister: The Government receive, representations about civil defence from time to time. Civil defence is a basic duty of any responsible Government. Since 1986, Government grant-aided civil defence expenditure by local authorities has risen from just over £15 million to £23 million, a significant real increase.

Mr. Browne: Will my right hon. Friend assure the House that the recent Government announcement on planning for emergencies in peacetime will in no way change their attitude to civil defence in time of war?

The Prime Minister: It will not, because of course, as I said in my original reply, we have a basic duty to provide civil defence. Although we hope that East-West relations will improve, it would be very wrong to retreat from that basic duty. I have seen, at first hand, the need for excellent services in emergencies and disasters, and what the civil defence people can do to help. We are anxious to do everything that we can, on a national basis, to take all practical steps to help our emergency services meet the demands upon them. The measures that my right hon. Friend the Home Secretary recently announced about a civil emergencies adviser will lead to clear improvements in our capacity to respond to those tragedies.

Mr. Spearing: Can the Prime Minister tell us why she has abandoned the long-established and successful means of raising local revenue to pay for civil defence? Why, as the high priestess of market forces, has she managed to persuade her right hon. Friend the Secretary of State for the Environment, the high priest of market forces, to take on the ill-formed plans of the former Secretary of State for the Environment, the present Secretary of State for Education and Science? Surely a much better way of raising revenue for civil defence and all local services would be a tax on property, based on either rental or freehold value?

Mr. Speaker: Briefly, please.

Mr. Spearing: That would be much better than her present plan.

The Prime Minister: The question was about civil defence, and I pointed out that since 1986 Government grant-aided civil defence expenditure by local authorities has risen from just over £15 million to £23 million. The hon. Gentleman asked about the community charge, which is by far the fairest way in England to raise 25 per cent. of local government expenditure, in Wales to raise

only 18 per cent. of local authority expenditure and in Scotland to raise only 14 per cent. of local authority expenditure.

Engagements

Mr. Bendall: To ask the Prime Minister if she will list her official engagements for Thursday 20 July.

The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.

Mr. Bendall: In view of the continued rail strike, and the inconvenience being caused to commuters, will the Government consider bringing in legislation to outlaw one-day strikes, such as other European countries are considering? What encouragement will the Government give to trade unions and employers to rationalise affairs so that there is one union for one industry?

The Prime Minister: I think that it is tragic that there has been no settlement in the rail dispute, especially as two unions accepted the award of the independent arbitration tribunal. Only one, the NUR, decided not to and prefers to put the public—the customers, who will retreat from using rail if they are treated like this—to great inconvenience once again.
We are looking at the possibility of further legislation and examining European legislation which usually includes some protection against unions in the public sector going on strike. European legislation and history tend to be very different from ours, but we are looking at it all to see whether we can learn something from it. With due respect, I do not think that it would make much difference to have only one union. It is much more complicated than that, but I hope to bring forward in the future any proposals that we may have.

Mr. Kinnock: May I congratulate the Prime Minister on the characteristic generosity that she showed yesterday by staying away from the poll tax statement so that her Secretary of State for the Environment——

Hon. Members: Where is he?

Mr. Speaker: Order. We have only three more minutes.

Mr. Kinnock: —sothat her Secretary of State could gain all the glory and the credit for himself? How does the Prime Minister think—[Interruption.]

Mr. Speaker: Order. Mr. Kinnock.

Mr. Kinnock: How does the Prime Minister think she can duly reward the memorable performance of the Secretary of State in the very near future?

The Prime Minister: I note once again that the right hon. Gentleman resorts to personal criticism because he has neither the intellect nor the guts to ask a real question about the community charge which he knows will show up—when in operation—high-spending local authorities for what they are: extravagant expenders of taxpayers' money.

Mr. Kinnock: Can the Prime Minister show the intellect or the guts to say whether she thinks that those of her hon. Friends who are calling for the Secretary of State's rightful dismissal are wrong?

The Prime Minister: Once again the right hon. Gentleman resorts to personal abuse because he cannot do anything else. I have the greatest confidence in my right hon. Friend the Secretary of State for the Environment, and, as the right hon. Gentleman knows, the community charge is a way of asking people to pay for what they vote for, and when they do, they will vote against Labour authorities.

Mr. Neil Hamilton: To ask the Prime Minister if she will list her official engagements for Thursday 20 July.

The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.

Mr. Hamilton: Is my right hon. Friend aware that more and more dockers are sensibly defying the strike leaders and returning to work? Is she aware that many former registered dockers have entered into new and more flexible

practices with the port employers, which will ensure prosperity for those ports and jobs for those dockers and many others? Does not their forward-looking behaviour contrast markedly with the last twitchings of bonehead trade unionism, as on the railways?

The Prime Minister: I agree that many dockers and most people are coming to realise that the end of the dock work labour scheme and that monopoly means a much more prosperous future for those ports and for the industries in the hinterland that they serve. Many dockers are steadily going back to work, and I hope that they will continue.
We have yet to know whether the Opposition will support the NUR, which did not follow the established procedures, does not think of the customers, or support those unions that wisely follow the established procedures and think more of their customers and of travellers than of themselves.

Business of the House

Mr. Frank Dobson: May I ask the Leader of the House to state the business for next week?

The Lord President of the Council and Leader of the House of Commons (Mr. John Wakeham): The business for next week will be as follows:
MONDAY 24 JULY—Completion of Consideration of Lords amendments to the Electricity Bill.
Afterwards there will be a debate on parliamentary pensions on a motion for the Adjournment of the House.
TUESDAY 25 JULY—Opposition Day (18th Allotted Day). Until about seven o'clock, there will be a debate entitled "The Practical Implications of the Poll Tax for the People". Afterwards there will be a debate on a subject to be announced. Both debates will arise on Opposition motions.
Motion to take note of EC documents on road safety. Details will be given in the Official Report.
Motion to take note of EC document on freedom of movement for workers. Details will be given in the Official Report.
WEDNESDAY 26 JULY—Until about seven o'clock motions on Social Security regulations. Details will be given in the Official Report.
Consideration of Lords amendments to the Fair Employment (Northern Ireland) Bill
Proceedings on the Extradition Bill [Lords], which is a consolidation measure.
Remaining stages of the Law of Property (Miscellaneous Provisions) Bill [Lords].
Proceedings on the Continental Shelf Bill [Lords].
THURSDAY 27 JULY—Motion for the summer Adjournment.
Proceedings on the Consolidated Fund (Appropriation) Bill
FRIDAY 28 JULY—Debates on the motion for the Adjournment.

[Tuesday 25 July

(1) Relevant European Community Documents

(a) 4303/89 Road safety
(b) 9228/88 Compulsory use of seat belts in road vehicles
(c) 4252/89 Alcohol level for drivers
(d) 4305/89 Vehicle speed limits
(e) 4156/87 Road speed limits

Relevant Reports of European Legislation Committee

(a) HC 15-xv ( 1988–89) para 4.
(b) HC 15-vi ( 1988–89) para 2.
(c) HC 15-xiv (1988–89) para 3.
(d) HC 15-xiv (1988–89) para 4.
(e) HC 22-xii ( 1986–87) para 2.

The Minutes of Evidence taken before the Sub-Committee of the Select Committee on European Legislation HC 507-i and HC 15-xxxi (1988–89).

(2) Relevant European Community Document


5786/89
Freedom of movement and rights of residence

Relevant Report of European Legislation Committee HC 15-xxi ( 1988–89 ) para 4.

Wednesday 26 July

Affirmative Regulations made under the Social Security Act 1989:
Community Charge Benefits (General) Regulations.
Social Security (Unemployment, Sickness and Invalidity Benefit) Amendment No. 2 Regulations.
Income Support (General) Amendment No. 2 Regulations.]

Mr. Dobson: I thank the Leader of the House for his statement.
Do the Government propose changing the business for next week to give the House the opportunity to debate the general practitioners' overwhelming rejection, in a ballot, of the contract that the Government wanted them to accept? When deciding what to do, will the right hon. Gentleman recall that, after the Secretary of State for Health thought that he had reached an agreement, he rushed to the House on Friday 5 May like a dog with two tails? Will the right hon. and learned Gentleman come back to the House now that the doctors have docked the tail? He said that the agreement that he thought that he had reached was
a very significant step in the development of the family doctor service".—[Official Report, 5 May 1989; Vol. 152, c. 480.]
Clearly that step has been halted and the House is entitled to know what the right hon. and learned Gentleman intends doing next.
Moving from health generally to health in Wales, the Leader of the House will recall that my right hon. and hon. Friends from Wales have been pressing for a statement on the impact of the National Health Service review on Wales, or a debate in the House or the Welsh Grand Committee. Has any progress been made?
When are we likely to get the long-promised debate on the Government's proposal to substitute student loans for student grants?
Whether or not the Leader of the House is with us in this incarnation next Thursday, can he tell us whether he has made some progress towards establishing a Select Committee on Scottish Affairs, to which the people of Scotland are entitled both by right and by our Standing Orders? If the right hon. Gentleman will not be in that incarnation next Thursday, will he tell his successor that Scottish Members will not rest satisfied until they have such a Select Committee?

Mr. Wakeham: The hon. Gentleman asked me four questions about next week's business. First, he asked me whether my right hon. and learned Friend the Secretary of State for Health would be making a statement about the general practitioner contract ballot result. The answer is no. My right hon. and learned Friend regrets the GPs' decision not to support their own negotiators and to reject the contract agreed with the BMA on 4 May. Those negotiations were hard fought and concessions were made by both sides to ensure a fair deal which could bring forward further improvements to patient care. My right hon. and learned Friend is consulting the BMA's general medical services committee leaders on detailed regulations to implement the contract agreed on 4 May and will lay those before Parliament in the autumn. Good GPs have nothing to fear from the new contract which will reward doctors who provide the service that patients want and need.
A number of right hon. and hon. Gentlemen have asked questions about the National Health Service in Wales. My right hon. Friend the Secretary of State for Wales and officials in his Department have had extensive discussions with a wide range of interests on the White Paper "Working for Patients" and in particular on the Welsh chapter. My right hon. Friend will be writing soon to health interests in Wales reporting on the outcome of the discussions and the next steps. He will make that publicly available. That is the procedure adopted by my right hon. and learned Friend the Secretary of State for Health.
On top-up loans for students, we made it clear that we would be happy for the House to debate the Government's plans and the Opposition's pledge to deprive students of the opportunity to add to their resources. The timing of such a debate is a matter for discussion through the usual channels.
The hon. Gentleman knows that the question of the Select Committee on Scottish Affairs is difficult. I have nothing further to add to what I said a little while ago.

Sir Bernard Braine: Does my right hon. Friend recollect that it is some years since the Warnock committee reported in favour of embryo experimentation although, of course, a substantial minority reported against it? That experimentation is continuing without the proper protection of the law passed by the House. The Government have promised that there will be legislation in the next Session. Can my right hon. Friend confirm that, and, at the same time, ensure that such legislation comes first to this House?

Mr. Wakeham: I know that my right hon. Friend has taken a deep interest in these matters over many years. It was probably a slip of the tongue when he said that the Government have promised to legislate in the next Session. The Government promised to legislate in the course of this Parliament. I cannot, of course, discuss at the moment what is in next Session's legislative programme.

Mr. James Wallace: Does the Leader of the House accept that people north of the border and Scottish Members have been incredulous about the squeals of protest coming from his right hon. and hon. Friends about the impact of the poll tax, as for the past two years, his hon. Friends have unthinkingly walked into the Lobbies to impose both primary and secondary poll tax legislation on the Scottish people? Given that such hon. Members are so out of touch with what the people want, can we expect a statement from the Secretary of State for Scotland next week announcing the Government's participation in the Scottish convention with a view to setting up a Scottish parliament within the United Kingdom?

Mr. Wakeham: No, the hon. Gentleman cannot expect that next week. I agree with him in part that some of us are a bit incredulous about some of the exclamations over the introduction of the community charge, because any reasonable person who examines the alternatives proposed by his party or the Labour party will recognise that the community charge, with all its transitional difficulties, is an infinitely better alternative than anything proposed by Opposition parties.

Sir Dudley Smith: I ask my right hon. Friend to look at yesterday's Hansard, where he will see some interesting exchanges about the Monopolies

and Mergers Commission. In view of the great deal of controversy about the efficacy of that organisation, does he not think that it is time we had a debate on the whole subject, especially bearing in mind the developments taking place in 1992?

Mr. Wakeham: I agree that this is an important subject. I cannot promise my hon. Friend a debate on it next week, but, as he will be aware, there are many opportunities for him to seek to raise the matter during next week. There are at least three separate occasions on which he might try his luck.

Mr. Bob Cryer: Could we have a debate next week on community care, which has been the subject of recent statements allowing only limited opportunity for debate? A debate is important because of the need to retain hospitals for mentally handicapped people, such as the Westwood hospital in my constituency. As it is set in attractive surroundings, it is feared that moves could be made to sell the land to private development speculators. In such a debate we could emphasise the concept of a village community and how the facilities for mentally handicapped people can be retained and developed.

Mr. Wakeham: I do not accept the premise of the hon. Gentleman's question, although he raises an important issue. As I said last week, the Government will publish a White Paper early in the autumn, and it would be most appropriate to have a debate on the subject then.

Mr. Greg Knight: Are we likely to have a debate in the foreseeable future on the working practices of the House? If so, has my right hon. Friend seen the Labour party's policy review report which recommends that the House sits for three days a week and has 15 weeks holiday a year? Does he agree that the document is nothing more than a slackers' charter and will he confirm that he has no intention of implementing its recommendations?

Mr. Wakeham: I thought that the document showed that the Labour party might have to work harder in future than it has in the past. I have no time for a debate on the subject next week.

Mr. Michael Foot: Will the Leader of the House reconsider the announcement that he apparently made a few minutes ago that the Secretary of State for Health intends to impose the doctors' contract without the House having a chance to comment on it? As the doctors have voted by about three to one against accepting the contract, is that not an appalling way to treat a great profession? Will he seriously consider allowing the House to debate the matter before the Government proceed?

Mr. Wakeham: The negotiators have been rejected by their members. The Government have negotiated with the BMA on this and the right course of action is to get on with it.

Mr. Bob Dunn: Will my right hon. Friend give an undertaking that on our return in the autumn he will announce an early debate on the opportunities for private enterprise to take over transport activities? Is he aware that the strikes by British Rail employees have thrown into focus a tremendous weakness in the south-east in people's opportunities and options to gain access to


their place of work in the capital city? Does he agree that we need an injection of cash from the private sector to provide alternative forms of transport into London?

Mr. Wakeham: My hon. Friend is right to raise those important issues. It would be helpful to have a debate, but it is difficult for me to promise one in the immediate future.

Mr. Merlyn Rees: The Leader of the House will remember that this time last week I complained that there were to be 15 statutory instruments before the House, all relating to development corporations, which remove powers from local authorities and make it difficult for people to raise locally issues which previously they could deal with at town halls. I am grateful to him for removing the Leeds orders which will be debated next Tuesday. Does he accept that we can raise issues relating to development corporations only in the House and that they cannot be dealt with locally? Should we not have a Committee of the House on the development corporations similar to the Committee on Northern Ireland legislation, following the removal of local authority powers there, so that we can raise issues with Ministers regularly? We cannot do so locally because local authority powers have been removed.

Mr. Wakeham: I am grateful for the right hon. Gentleman's comments about the changes that I made, after I had agreed with him that the arrangements that had been made were not satisfactory. With regard to his wider suggestion, of course I take seriously any suggestion from someone with the experience of the right hon. Gentleman. Perhaps the best plan is for us to have a discussion to see whether we can come up with any ideas to put to other people.

Mr. Alistair Burt: Is my right hon. Friend aware of the rather desperate situation affecting local government in my constituency? Last night, a full scheduled meeting of the local council was cancelled on the mere say-so of the local NALGO representative, who asked the council leader to abandon it, which he agreed to do. Is it not important to have a debate so that hon. Members' views on such anti-democratic practices, which are damaging local authority services, can be tested in public?

Mr. Wakeham: I agree that it would be helpful to have such a debate, but I cannot promise one. It would be helpful if the unions involved could reach agreement with employers and cease putting the public to such inconvenience.

Mr. Pat Wall: No doubt the Leader of the House has seen reports in the press about the return of a Chinese dissident, Mr. Xu Hai Ning. He is a Chinese journalist with the New China Press Agency in Hong Kong. He came to Britain after making statements condemning the assassinations in Beijing and was granted leave to stay until 30 June 1990. According to statements, he returned to Hong Kong voluntarily. This case raises disturbing aspects: first, the appearance of threatening advertisements in the Chinese business newspaper that is published in Soho; secondly, the disclosure of escape routes of Hong Kong dissidents that will result from his return to Hong Kong; and thirdly, the fear that it will

create among the Chinese community in Britain. I interviewed this gentleman last week, and he was nervous and distraught about his status in this country and his lack of a travel document. In those circumstances, does the Leader of the House agree that the Minister of State, Home Office should make a statement about his return and its consequences for the Chinese community in Britain and other dissidents?

Mr. Wakeham: I recognise that the hon. Gentleman raises an important matter. The gentleman concerned, who is a Chinese national, was granted leave to enter the United Kingdom on 30 June. On 17 July, he contacted his embassy in London and asked to return to China. On his departure from the United Kingdom he was interviewed in private by an immigration officer, when he confirmed that he was returning to China of his own free will. He appeared calm and well and expressed himself clearly. There was, therefore, neither power nor reason to prevent this gentleman's departure.

Mr. Ivor Stanbrook: Will my right hon. Friend consider, together with the usual channels, the sending of an official British parliamentary team of observers to the independence elections in Namibia? The need to ensure that its elections are fair and free is just as great as when we similarly sent an official team of observers to represent Parliament in Rhodesia—Zimbabwe in 1980.

Mr. Wakeham: I recognise the importance of the issue that my hon. Friend raises. I am not in a position to give him a full answer, but I shall refer the matter to those who will be able to give him a better answer.

Mrs. Margaret Ewing: The Leader of the House will no doubt remember that in response to an earlier question he said that Scotland was experiencing transitional difficulties as a result of the implementation of the poll tax. While experimentation might be a better description of what is happening in Scotland, has he had an opportunity to study early-day motion 1177, in the name of the hon. Member for Falkirk, East (Mr. Ewing)?
[That this House calls upon the Secretary of State for Scotland to introduce an amendment to the Abolition of Domestic Rates (Scotland) Act in order to ensure that the practice of the next of kin of a deceased person receiving an account for the outstanding amount of poll tax payable to the date of death is ended forthwith; and urges the Secretary of State to recognise that at a time of such family trauma the receipt of such an account causes great distress and to further recognise that this is not a matter for regional and islands councils but is a legislative matter for Her Majesty's Government.]
May we expect an early statement from the Secretary of State for Scotland about stopping the obscene practice of levying the poll tax on the relatives of the recently deceased?

Mr. Wakeham: The position on the transitional arrangements for the community charge is this. When the Government end a system that has for years been unfair in certain areas, and there is a transitional arrangement, there are always difficulties because those who have been unfairly treated for a long time do not feel that they are getting the benefits to which they are entitled as quickly as they should. That is the essence of the problem of the safety net.

Sir Philip Goodhart: Is my right hon. Friend aware that many thousands of my constituents are without piped water and face a weekend without piped water as a result of the incredible ineffeciency of Thames Water? As many hundreds of thousands of people in south London are faced with a serious water shortage this weekend, may we have an urgent ministerial statement, as a considerable health hazard is involved?

Mr. Wakeham: Thames Water very much regrets the considerable inconvenience caused to consumers and assures us that it is doing all that it can to restore normal supplies as quickly as possible. I understand that the reasons for the lack of mains water supply in my hon. Friend's constituency and in other parts of London are the exceptionally high demand for water resulting from the hot weather and a substantial reduction in capacity from the Hampton water treatment works. Consumers are being informed and alternative water supplies are being provided. Essential users such as hospitals are being given priority.

Mr. D. N. Campbell-Savours: Is the Leader of the House aware that I am one of the two objectors to the accounts of Westminster city council, tabling as I did last year some 83 objections? Is he not outraged by the allegations last night on "Panorama" that personal files are being kept on councillors and their friends, wards are being gerrymandered for electoral benefit, and that officials of the council are being intimidated? What will the Government do about this? Is pressure being exerted on Lady Porter to resign, because what she is doing is nothing less than municipal fascism and the British people do not want it?

Mr. Wakeham: I am surprised that the hon. Gentleman should ask his question in such an intemperate fashion. There are proper ways to investigate any allegations of irregularities, and trial by television or accusations in the House by the hon. Gentleman under privilege are not a proper way to deal with them. Any allegations of misuse or improper use of ratepayers' money will be examined in the first instance by the auditor as part of his normal duties. That is the proper way to investigate this matter.

Mr. James Hill: Has my right hon. Friend read the debate on foreign affairs last Friday? If he did so, he would see that there is terrific lack of knowledge of the workings not only of the international side of the Council of Europe, but of the Western European Union. Some unnecessary things were said in that debate, trying to denigrate the 23-nation Council of Europe, while at the same time casting doubt on the valuable work that that body does. I wish to bring to the attention of my right hon. Friend that it contains the Court of Human Rights and has brought documents——

Mr. Speaker: Order. The hon. Gentleman should be asking for a debate.

Mr. Hill: It contains much informative documentation. Now that Mr. Gorbachev has spoken to the Council of Europe, and that we have many guest advisers from the USSR, Hungary, Yugoslavia and Poland, should not the House, once and for all, have a debate of some international significance on these two important institutions?

Mr. Wakeham: In spite of the very busy time of year I arranged debates on China and Hong Kong last Thursday and on foreign affairs last Friday. I cannot be held responsible for everything that is said in such debates, although I am sorry if the very valuable work in which I know my hon. Friend has played a large part for a good many years was not properly recognised. I remind my hon. Friend that there are a number of occasions next week on which he might wish to raise the subject and put the record straight.

Mr. David Winnick: Further to what my hon. Friend the Member for Workington (Mr. Campbell-Savours) said, does the Leader of the House realise that the serious malpractices of Westminster city council are scandalous and that Lady Porter has undoubtedly shown herself to be totally unfit to hold any kind of public office whatever?

Mr. Speaker: Order. The same rules must apply to the hon. Member for Walsall, North (Mr. Winnick). These are business questions and we are dealing with the business for next week.

Mr. Winnick: I did ask for a debate, Mr. Speaker.
In case this is the last appearance by the present Leader of the House, may I thank him for the courteous way in which he has tried to answer our questions, but wonder why under this Government everyone who has held his position has ended up being sacked?

Mr. Wakeham: It was a member of the hon. Gentleman's own party who said that he was the stupidest man in the House. That was many years ago and the hon. Gentleman is even more stupid now than he was then. None the less, I thank him for his expressions of goodwill.

Mr. Robert Adley: I have a slight cold, so I may not have heard properly at Question Time today. I heard the Leader of the Opposition accuse my right hon. Friend the Prime Minister of not having been here for yesterday's statement, but I did not hear the Leader of the Opposition or the shadow Leader of the House mention the rail strike. Perhaps my right hon. Friend the Leader of the House can tell me whether my hearing is defective. Does my right hon. Friend agree that this is a matter of great concern and that if we had a statement next week, it might quietly enable leading members of the Labour party to seek to use their influence to get the National Union of Railwaymen to see sense? Will my right hon. Friend use his best offices somehow through the usual channels to provide a forum for an exchange at the Dispatch Box next week so that all of us can send a message to the NUR saying, "Please go back to work"?

Mr. Wakeham: I understand the Opposition's difficulty, because they do not know whether to support the unions that have accepted the agreement through the proper negotiating machinery or the union that has not. The sooner they make up their minds, the better it will be for all of us. The strike and the inconvenience to the travelling public must be brought to an end soon.

Mr. Dave Nellist: May I back up the request made by my right hon. Friend the Member for Bradford, North (Mr. Wall) for a debate, or preferably a statement, later today about the case of Mr. Xti Hai Ning, about which I, too, made several telephone calls to the Home Office and the Foreign Office on Tuesday?


Should not the House and the people of Britain be concerned that the visit on July, which the right hon. Gentleman mentioned, was the fourth visit that Mr. Xu Hai Ning had made to the embassy? On three occasions he had changed his mind about returning to China. It was the pressure of advertisements in the Chinese business press and the harassment and threats to his family that finally forced him to return.
Should not the Home Office be concerned that the safe houses provided by the Chinese Solidarity Campaign—which I thought the Government would have contacted on this case—have not only been broken into, but have been visited by Chinese secret service personnel? What hope can people of Chinese extraction have that this country will act as a place of refuge if someone can be forced to return under duress by the tactics used on Mr. Xu Hai Ning? Should not we have a statement on this matter?

Mr. Wakeham: The hon. Gentleman will be aware that I came to the House with a prepared Home Office brief and, therefore, I think that I speak with some authority on the matter. The information given to me does not coincide with the information that the hon. Gentleman has given the House. This gentleman, a Chinese national, was interviewed in private by an immigration officer and he confirmed that he was returning to China of his own free will. As is reported, he appeared calm and well and expressed himself clearly. There was, therefore, no power or reason to prevent his departure.

Mr. Michael Marshall: My right hon. Friend knows my interest in this matter. When does he hope there may be time for a debate on the report on telecommunications of the Services Committee, which affects the provision of services in the House, particularly in view of the decision to extend for a further 12 months the opportunity for competitive services in telecommunications in Parliament, as opposed to Whitehall?

Mr. Wakeham: I agree that it is a suitable subject for debate, but, as my hon. Friend knows, the report has only just been published. It would probably be more valuable if we considered the report before having a debate.

Mr. Roy Hughes: May we have a debate next week on the Government's proposal, which was announced some months ago, to double tolls on the Severn bridge? Does he appreciate that there were many objections to the proposal and that an inquiry was held? The commissioner's report has been in the hands of the Secretary of State for Transport for some weeks, but he is sitting on it. Presumably his intention is to announce his findings a day or so before Parliament adjourns for the summer recess. Does not the Leader of the House think that that is sharp practice?

Mr. Wakeham: I do not think that it is sharp practice. One man sitting on it is another man considering it. My right hon. Friend has the report and, as the hon. Gentleman said, he is considering the matter.

Mr. Andrews Rowe (Mid-Kent): I believe that my right hon. Friend is aware that many people in Kent are interested in railways. Given that British Rail is trying hard to get a private Bill ready by mid-November and that the consultation period with the public will end during the

summer recess, does my right hon. Friend agree that it would be appropriate to have a debate in October on that important subject before the Bill is brought to the House, because that would exclude a debate until about April?

Mr. Wakeham: I recognise the strength of feeling of my hon. Friend and a number of my hon. Friends from Kent and of their constituents. I understand, however, that British Rail is considering promoting a private Bill to seek to do what it needs to do. There will be plenty of opportunity for that matter to be debated when it comes before the House. I do not, therefore, feel able to offer my hon. Friend a special debate on the subject.

Mr. John Hughes: May I draw the attention of the Leader of the House to early-day 1172, motion which requests the Secretary of State for Health to make a statement on the Birmingham children's hospital?
[That this House is seriously concerned at the irresponsible statement which the Minister of State for Health made to the National Association of Health Authorities, that a 900,000 hospital waiting list could be attributed to surgeons not doing as much work as they should; considers that sweeping statement an affront to the young surgeons at the Birmingham Children's Hospital whose revolutionary techniques have reduced the time babies spend in intensive care from days to hours, giving the surgical team the capability of carrying out 380 operations annually; and in the light of the Minister's categorical assurance that, regardless of cost, patients would get the treatment they required, believes he should make a statement to the House countermanding the Central Health Authority's restriction, which is putting at risk the lives of 140 babies waiting for open heart surgery, thereby allowing the surgeons to work to their maximum capacity of 380 operations and disband the special committee set up illogically to investigate why a surgeon in the process of saving babies lives exceeded the Central Health Authority's restriction quota.]
I ask the right hon. Gentleman to include in that statement an investigation into the Central Birmingham health authority's threat to dismiss surgeons who exceed the restriction of 320 patients which has been placed on them by that authority.

Mr. Wakeham: On the position of the Birmingham children's hospital, my hon. and learned Friend the Minister of State referred to a waiting list total of 691,000 in September 1988 and not 900,000. He referred to the findings of a study into 22 districts with problem waiting lists, which showed, among other factors, that some surgeons' workloads were below the level of most surgeons and those recommended by their professional bodies. My hon. and learned Friend drew attention to those other factors, too. The motion's criticism of his speech, which was well received and extensively reported, is entirely unfounded. The vast majority of surgeons work hard and conscientiously. For example, the planned level of 320 open heart operations at Birmingham children's hospital this year is more than double that of the year 1987–88.

Mr. David Sumberg: I support the plea of my hon. Friend the Member for Bury, North (Mr. Burt) for an early debate on the abject surrender by the Labour leader of Bury council to the demand of the National Association of Local Government Officers that the council


meeting last night be cancelled. Would a debate not show that it is an absolute sham for the Labour party to come here and talk about local government accountability, while at the same time denying local democracy to my constituents?

Mr. Wakeham: My hon. Friend is right. I suggest that, if he wants to raise the matter, he will have the opportunity next week.

Mr. Bob Clay: Does the Leader of the House accept that there is a strong case for a debate next week on a major constitutional issue? The Prime Minister should come to the House and explain why, in spite of all the rhetoric of the Bruges speech and subsequent postures, she is allowing the European Commission to prevent the reopening of the most modern shipyards in Europe, which are situated in my constituency, which have buyers who require no public funds or ongoing subsidy and who have immediate ships to build there. Is the Prime Minister to continue to allow that massacre of jobs in a great British industry, and may we have an urgent debate next week?

Mr. Wakeham: I disagree with the premise of the hon. Gentleman's question. My right hon. Friend the Chancellor of the Duchy of Lancaster has spoken and written to the hon. Gentleman about this and has discussed the matter in the House. I repeat that I do not accept the premise of the question.

Mr. Roger King: Can my right hon. Friend help me? During his enunciation of next week's business, I thought I heard that the Opposition had run out of things to debate for the second debate to be launched by them, yet we have had a torrent of suggestions from Opposition Members about what they should debate in Government time. Can my right hon. Friend help the Leader of the Opposition in arriving at a subject for debate next Tuesday? If the Opposition cannot come forward with ideas, should we not impose a subject for debate on them, such as the rail strike?

Mr. Wakeham: I have enough responsibilities without having to choose subjects for Opposition Supply days. My hon. Friend is not necessarily right in saying that the Opposition have not thought of a subject for debate. It is possible that they are having a little quarrel among themselves about which one to choose.

Mr. Doug Hoyle: May I draw the attention of the Leader of the House to early-day motion 1176?
[That this House condemns the extravagant and obscene pay increases awarded to the chairmen of former publicly owned assets since their privatisation by the present Government; notes that the percentage pay increases of the chairmen of the following companies since privatisation have been for British Aerospace 440·4 per cent. since 1980, British Airports Authority 111·7. per cent. since 1986, British Airways 631 per cent. since 1987, British Gas 91·8. per cent. since 1987, British Steel 28·7 per cent. since 1988, British Telecom 154 per cent. since 1985, Cable and Wireless 113·3 per cent. since 1985, and Rolls Royce 29·6 per cent. since 1987; and believes that these increases are an insult to the public and the low paid and show that privatisation results in private profit rather than public service.]
The motion relates to the pay rises of the chairmen of privatised companies and has been signed by 74 hon. Members. It describes the rises as "extravagant and obscene". Will the Leader of the House condemn those pay increases and arrange for a statement to be made next week on this important matter?

Mr. Wakeham: The Government do not support unjustified pay increases at any level. Pay is for the parties directly concerned to determine, taking into account performance and labour market conditions. It is not for me to comment on any individual case.

Mr. Spencer Batiste: My right hon. Friend will be aware that the publication yesterday of the White Paper on the reform of the legal profession has been greeted with fairly broadly based and widespread support on the basis of the balanced compromise that has been reached. Nevertheless, the House has not yet had an opportunity to debate the important issues involved. Is it my right lion. Friend's intention to give the House the chance for a debate before legislation is brought before us?

Mr. Wakeham: I recognise that it would have been much better if I had found time for a debate. I am still looking to see whether I can find the time for a debate. However, I assure my hon. Friend that we shall have plenty of opportunity to discuss these important issues.

Mr. Dennis Turner: May I draw the attention of the Leader of the House to early-day motion 1187?
[That this House expresses concern that the answer given by the Prime Minister to the honourable Member for Wolverhampton South East on 18th July, Official Report, column 218, was in complete contradiction to the advice received by the honourable Member for Wolverhampton South East from a senior Training Agency Manager in Wolverhampton, which indicated that information on Employment Training filled places statistics should not be given to the Member of Parliament, and therefore demands that an investigation be made in order to ascertain on whose authority the instruction was given.]
The motion brings into question the answer that the Prime Minister gave to me on Tuesday at Prime Minister's Question Time about the availability of information on employment training. In the light of the answer that the Prime Minister gave me and the evidence that I was flatly refused that information at local level, will the Leader of the House ask his right hon. Friend the Secretary of State for Employment to come to the House to make a statement, because the rights and responsibilities of Members of Parliament are at stake? We need some clarification about whether that information can be made available to Members of Parliament.

Mr. Wakeham: I thought for one minute that the hon. Gentleman was about to announce the second subject for debate on the Opposition day next week, but apparently not.
On the subect of early-day motion 1187, it is very definitely not the Government's policy to withhold from Members of Parliament information about how ET is performing. Evidence for that is the enormous amount of information that is being given in answer to written questions. I am delighted to announce that there are now


virtually 200,000 trainees on employment training. I am sure that the hon. Gentleman will wish to join me in congratulating the programme on its outstanding success.

Mr. James Cran: Will my right hon. Friend find time for the House to discuss the vexed problem of child cancer clusters in the United Kingdom, which is a matter of concern not only to the parents and certainly to the children involved, but to every Member of the House of Commons? Such a debate would allow those of us who are interested to assess what the Government are doing—which is not inconsiderable—to assess what other agencies are doing and perhaps also to discuss the fact that there are far too many reports of child cancer clusters in this country, but not enough research into the epidemiology of leukaemia.

Mr Wakeham: I recognise the concern and interest that my hon. Friend has taken in that subject. I understand that Dr. Cartwright's report has been referred for independent medical assessment, the results of which are expected shortly. I cannot comment on Dr. Cartwright's report until I have seen the results. The Government are funding several other studies on the incidence of childhood leukaemia and the Department of Health will continue to monitor closely the results of those studies and of other national and international work.

Mr. Ray Powell: Will the Leader of the House reconsider his reply to my hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson) on the business for next week? Next week will be the last week of business before the summer recess. In the past consecutive four weeks we have made temperate requests for a debate in the Welsh Grand Committee on the Health Service in Wales. The right hon. Gentleman will appreciate that some of us are becoming as intemperate as my hon. Friend the Member for Workington (Mr. Campbell-Savours), who asked a question earlier. We are sick and tired of asking the Secretary of State to come to the House or to the Welsh Grand Committee to debate the emotive subject of the Health Service in Wales. It is no good his having consultations with others in Wales if he is not prepared to answer questions from elected Members of Parliament. I am sure that you, Mr. Speaker, will agree that the Leader of the House—I have always thought of him as a temperate person and I do not share the views expressed by some of his colleagues, and even the Prime Minister, who might be getting the knife out—should give time for such a debate and put pressure on the Secretary of State for Wales, who is sitting round the corner, to come to the House before the end of the Session for that purpose.

Mr. Wakeham: I shall resist repeating that when there was an opportunity for a debate on the Health Service the Opposition did not want it and they did not have it.

Mr. Allan Rogers: That is a lie.

Mr. Speaker: Order. I ask the hon. Gentleman to withdraw that. Yesterday that word was bandied about the Chamber. We have strict standards and we do not accuse each other of lying. Will the hon. Gentleman, who is a Front-Bench spokesman, withdraw that?

Mr. Rogers: I withdraw the fact that I called the Leader of the House a liar. When you, Mr. Speaker, chastised me

some weeks ago on the same issue, I said that the Leader of the House was misleading the House in saying that the matter had not been brought before the Welsh Grand Committee because of the Opposition's objection to it, and you allowed that. It really is shabby for the Leader of the House to come here——

Mr. Speaker: Order. As the hon. Gentleman has said, this is an emotive subject, but we must keep up our standards in the House.

Mr. Wakeham: The subject for debate in the Welsh Grand Committee in June was chosen by the Government's supporters and they properly chose the valleys initiative, an important subject. I hope that the next meeting of the Welsh Grand Committee will take place in October when the Opposition will be able to choose the subject. My right hon. Friend the Secretary of State for Wales would very much welcome a debate on the Health Service in Wales on that occasion.

Mr. Nicholas Bennett: Is my right hon. Friend aware that the Health Service in Wales has been considerably disrupted in the past few weeks by the rail strikes which have meant that our constituents have not been able to get to hospital, but there has not been one word of condemnation from Opposition Members to reflect the views that I have heard from the elderly and the infirm? Will my right hon. Friend use his offices to persuade the Opposition to use their second debate on Tuesday to consider the rail strike so that we can get them off the fence and on to the side of the public, not the strikers?

Mr. Wakeham: My hon. Friend must be fair. Some Opposition Members are looking tired and it is time that they were at the seaside with their buckets and spades.

Mr. Greville Janner: Will the Leader of the House arrange an early debate on the unsatisfactory nature of the law relating to the camping of itinerants in public parks and on public land? Is the right hon. Gentleman aware that I have a petition signed by more than 370 people living on the Braunstone estate in my constituency? Is he further aware that I have also received complaints from constituents in Western Park, Beaumont Leys and other areas about gipsy encampments in parks, which are a danger to the environment and to public health and order at any time, but especially during hot weather and school holidays?
Will the right hon. Gentleman ensure that such a debate covers the question of how permanent sites might be provided so that those people can have the privacy to which they are entitled, well away from others who are also entitled to privacy and peace? In the meantime, will he please refer the matter to the Law Officers and the Home Secretary so that the law may be recognised and the police and local authorities given the powers necessary to deal with this growing and very serious problem?

Mr. Wakeham: I recognise the difficulty of the problem especially as, from time to time, my constituency suffers from it. The Department of the Environment also has an interest in the matter. I know of no proposals for changes in the law. However, it is a perfectly sensible subject for the hon. and learned Gentleman to raise and to which a Minister can respond. I shall refer his concern to the appropriate Ministers.

Mr. Harry Greenway: Will my right hon. Friend think again about his answers to my many hon. Friends who asked for a debate or statement on the rail strike? Is he aware that it is causing enormous inconvenience throughout the country, but especially to commuter constituencies such as mine? Is not the National Union of Railwaymen, apparently supported by the Opposition, depriving many people of their living on strike days? They cannot get to work and so have to stay at home and get no pay. That is a very serious matter because individuals and families are suffering greatly. Is it not time that the House debated the matter and flushed out the whole question?

Mr. Wakeham: Refusing, or simply being unable, to provide time for a debate in the near future does not in any way lessen the concern that I share with my hon. Friend about this matter. Strikes are always damaging. They do harm to businesses and services and are bound to put jobs at risk, as well as causing great inconvenience to commuters. There is no need for a debate on this matter because the issue is quite clear. The NUR should take the same line as the other unions. accept the generous offer made to it and return to work.

Mr. John McAllion: The Leader of the House said that he had nothing to add about the difficult question of the setting up of a Scottish Select Committee. Is he aware that the Scottish people have a great deal more to say, as was shown in the recent European elections when Scotland was made a Tory-free zone? If the right hon. Gentleman is genuinely concerned to tackle undemocratic practices, when will he change the Government's undemocratic stance and announce that Scotland is to have the Select Committee that it not only demands, but which is its right under the Standing Orders of this House?

Mr. Wakeham: The hon. Gentleman has a weird idea of democratic arrangements. The House determined that that Committee should not be set up and there was a majority for the line that I am taking. The hon. Gentleman is in the minority. Nevertheless, I am seeking a way to set up a Scottish Affairs Select Committee, and I shall continue to do so although, as the hon. Gentleman is well aware, certain difficulties are involved.

Mr. Alan W. Williams: Will the Leader of the House arrange a debate on the Welsh Development Agency, a matter raised by several Members during Welsh questions on Monday, and to which there was an unsatisfactory response from the Secretary of State for Wales?
Has the right hon. Gentleman seen early-day motion 1194, which draws attention to our concern about this matter?
[That this House expresses its deep concern on the future of the Welsh Development Agency; notes that legal, press and information services have already been contracted-out; seeks clarification as to whether the growth of private sector funding will infringe the statutory obligation of the Welsh Development Agency; expresses its deep concern that discussions have taken place between the Finance Director of the Welsh Development Agency and the privatised National Freight Corporation; calls on the Secretary of State to clarify the reasons for the week-long meeting which he did not when asked by honourable Members during Welsh

Questions on 17th July; expresses serious concern at the detailed discussions between a leading merchant bank and officers of the Welsh Development Agency; can only conclude that the Government is undertaking a policy of privatisation by stealth; further, expresses its deep concern that the Secretary of State for Wales claims not to have known that such important and detailed discussions on the future of the Welsh Development Agency were taking place; asks why, if a number of Welsh Office officials knew of the proposals as the Secretary of State admitted during Welsh Questions, they did not come to the attention of the Secretary of State; and also asks how many other radical alterations to bodies under his reponsibility are being planned, which he currently does not know about.]
We are aware that the WDA is contracting out legal services, publicity and information. It has had talks with the National Freight Corporation about privatisation and about how that company was privatised. There have been long discussions with Barclays de Zoete Wedd, the merchant bank, and the WDA in Cardiff. During the past six months there have been many comings and goings that make us suspect that there is a policy of privatisation by stealth. May we please have a debate on these matters?

Mr. Wakeham: My right hon. Friend the Secretary of State for Wales has already answered a large number of parliamentary questions on that subject, and I have nothing to add. There are no plans to privatise the Welsh Development Agency, but, as my right hon. Friend told the House, the agency is perfectly free to explore any ways of bringing more private sector funding into its activities. If it does so, the Government would expect the agency to hold whatever discussions are appropriate with outside interests and advisers.

Mr. Dennis Skinner: Will the Leader of the House reconsider his decision on a debate about the activities of Lady Porter and Westminster city council.? Is he aware that as a result of last night's "Panorama" programme on BBC television, the public are demanding that the matter be raised in Parliament? If Parliament is not for debating matters of extreme public interest, what is it for? I have a special interest in the matter, because of the way in which the Government and the Tories of the time treated my brothers and their colleagues on Clay Cross council, who did nothing other than refuse to raise rents. The Government were also prepared to surcharge Lambeth and Liverpool councillors. Why is it that there is one law for Tory councillors and for friends of the Prime Minister such as Lady Porter, and another law for Labour councillors? The only redeeming feature is that there is a strike at Westminster city council and that the men and women on strike there are, thank God, stopping Lady Porter getting rid of more taxpayers' and ratepayers' money today.

Mr. Wakeham: The hon. Gentleman may wax indignant, but whatever may or may not have happened to his brothers and to others in the past, it was the result of the due process of law and not of trial by television, which the hon. Gentleman seems to support. If anything needs to be investigated, it will be investigated by the proper authorities—not in the manner that the hon. Gentleman seems to think is appropriate.

Mr. Frank Haynes: I do not mind you, Mr. Speaker, leaving me until last. You know that I am the most patient of all right hon. and hon. Members.
Is the Leader of the House aware that 15 years ago troops from the Turkish mainland invaded the beautiful island of Cyprus? Is he further aware that my hon. Friends the Members for Jarrow (Mr. Dixon) and for Ogmore (Mr. Powell) have a particular interest in that event? Is he aware that in the past few hours there has been a serious incident in which more than 100 people were arrested by the Turkish authorities at the green line—females, on the Greek Cypriot side? Is the right hon. Gentleman aware also that I tried and tried, on behalf of my friends, to obtain information about the 1,600 people who disappeared during the 1974 invasion? Will the Leader of the House, in the last week before the recess, get a Foreign Office Minister to the Dispatch Box, to see whether he can help the Greek Cypriots, who are in desperate need?

Mr. Wakeham: I cannot promise that, but I can tell the hon. Gentleman—quite exceptionally, because such a matter is not usually noted from this Dispatch Box—that the all-party Cyprus group is currently meeting in the Commonwealth Parliamentary Association room and that my right hon. Friend the Minister of State, Foreign and Commonwealth Office is addressing it on that very subject. If the hon. Gentleman nips round there quickly, he might be in time to hear her.

Debates on Adjournment Motions

Mr. Speaker: I have a short statement to make about arrangements for the debates on the motion for the Adjournment that will follow the passing of the Consolidated Fund (Appropriation) Bill on Thursday 27 July. Right hon. and hon. Members should submit their subjects to my office not later than 9 am on Wednesday 26 July. A list showing the subjects and the times of the debates will be published later that day.
Normally, the time allotted to each debate will not exceed one and one half hours, but I propose to exercise discretion, to allow one or two debates to continue for rather longer—up to a maximum of three hours. Where identical or similar subjects have been entered for debate by different right hon. and hon. Members whose names are drawn in the ballot, only the first name will be shown on the list. As some debates may not last the full time allotted to them, it will be the responsibility of right hon. and hon. Members, if they are not to miss their turn, to keep in touch with developments.
I remind right hon. and hon. Members that on the motion for the Adjournment of the House on Friday 28 July, up to eight right hon. and hon. Members may raise with Ministers subjects of their own choosing. Applications should reach my office by 10 pm on Monday next. A ballot will be held on Tuesday morning, and the result will be made known as soon as possible thereafter.

Local Government Finance (Wales)

The Secretary of State for Wales (Mr. Peter Walker): With permission, Mr. Speaker, I should like to make a statement about local government finance in Wales for 1990–91.
From April 1990, as the House will know, the new local government finance system will be in operation. Domestic rates will have been replaced by the community charge; there will be a national non-domestic rate with a uniform rate poundage throughout the Principality, and there will be a new grant system. In order to assist local authorities in making their plans for the first year of the new system, I am today announcing my proposals for the overall level of support towards local authority revenue expenditure in Wales from grants and non-domestic rates.
My proposals must be seen in the context of local authority spending in 1989–90. For the current year Welsh councils have budgeted to spend £1,850 million—some £42 million, or 2·3 per cent., above the Government's plans. This year-on-year increase in spending of 8 per cent., although closer to plans than that of their English counterparts, is nevertheless too high.
I have taken account of the local authority associations' representations on the pressures for spending in 1990–91—I discussed their views with them in the forum of the Welsh consultative council on local government finance on 12 July—but I have also had regard to the need for authorities to seek and achieve efficiency savings, taking steps to control staffing costs and restricting budget increases to affordable levels.
In the light of all those considerations, I propose that for 1990–91 the total of standard spending—under the new system, this is the amount that I consider appropriate for local authorities to spend in order to deliver a standard level of services—should be set at £2,109 million. That is an increase of £182 million on the comparable figure for 1989–90, and represents an increase of £140 million on authorities' budgeted expenditure for the current year.
I propose to set the level of aggregate external finance—which comprises three component parts: revenue support grant, the distributable amount of national non-domestic rates and certain specific grants towards current expenditure—at £1,733 million. That is an increase of 8·6 per cent. on the equivalent figure for 1989–90, adjusted for changes in functions. In the autumn I shall announce details of the division of aggregate external finance into its three component parts.
Let me now deal with the consequences of the proposals for the individual community charge payer in Wales. The components of aggregate external finance, taken together, will represent some 82 per cent. of total standard spending. After account is taken of community charge benefits, only 15 per cent. of local government spending will be financed by community charges. That broadly maintains the relative shares in the present financial year.
The community charge for standard spending in Wales will be £175, only £4 more than the average rate bill per adult in 1989–90. That reflects my commitment that no resources would be lost to Wales as a result of the change to the new system. Charge payers will quickly understand the reasons for variations from this figure, which—subject to the transitional arrangements that I shall describe in a

moment—is achievable by each and every authority that spends in line with the Government's standard spending assessment.
I have considered again the extent to which the effects on charge payers of the change to the new system should be phased in through an appropriate "safety net". In the light of the favourable settlement that I am proposing, I have decided that it would not be right to freeze the position as it was in 1989–90 by using a full safety net: that would delay the benefits of the greater accountability which the new system brings. Instead I propose to introduce a safety net which will move us substantially towards the new system in the first year.
That means that—on the basis of present estimates—in 1990–91 in the Rhondda, for example, charge payers would contribute some £50 less than the Welsh average of £175 towards their council's services. The arrangement will also benefit charge payers in areas such as Newport and Cardiff, who should contribute only around £20 to the cost of the safety net. The proposals strike the right balance between protection for those who, in moving to the new system, face the largest increases, and reasonable contributions from those who stand to gain.
I will inform the House about the position of individual authorities following further consultation with the local authority associations about grant distribution arrangements, including the precise details of the safety net. I agree with the associations that it would be misleading to produce illustrative figures for 1990–91 in advance of that.

Mr. Allan Rogers: Speak more slowly.

Mr. Walker: I will speak very slowly, as the next passage is of great importance. It concerns the arrangements we have made to assist those on low incomes. Those on the lowest incomes in Wales who qualify for income support will be better off with the community charge than they were under the old rating system, because income support payments will include an amount—which will be the same throughout Great Britain—to help pay the community charge. Owing to the low levels of community charges in Wales, people would actually be better off than they would if they received a 100 per cent. rebate.
A couple on income support paying the community charge for standard spending of £175 each would get the maximum rebate of 80 per cent. leaving them with a combined liability of £70. To help them meet this their income support will have been uprated by an annual amount equivalent to £119·60, leaving them £49·60 in pocket. We estimate that over 300,000 community charge payers in Wales—about 14 per cent.—will qualify for the maximum assistance.
I will be bringing forward more detailed arrangements for all aspects of the settlement in the autumn, following discussions with the local authority associations. But the proposals I have announced today offer charge payers in Wales the prospect of community charges averaging £175 provided that their councils take responsible spending decisions. They offer authorities—particularly those who seek and achieve the efficiency gains which are available—a fair and realistic framework within which to set their budgets for 1990–91. If they budget sensibly, the rewards are self-evident.

Mr. Barry Jones: If the new system is so wonderful, why the eleventh hour acrobatics to alter and improve it? Are they not a tacit admission of its unpleasantness by delaying its impact?
Will the Secretary of State explain why there appears to be a shortfall on the aggregate external finance figure? We note a paucity of the detailed examples that were provided yesterday. On that basis the Secretary of State has made a defective statement. Has not the right hon. Gentleman made inadequate provision for inflation? With the RPI at 8·3 per cent. and pay awards well over 7 per cent., the Government's estimate of the effects of inflation this year is likely to be about 3 per cent. out at outturn. Therefore, many of our councils are cheated of a lot of money.
The statement fails to take full account of the high interest rates on local councils' capital charges. Regarding the Rhondda exemplification, of which the right hon. Gentleman made much in his statement, the House should know that professional opinion is that the right hon. Gentleman is engaged in a doubtful conjuring of the figures. A current ratepayer in the Rhondda faces an average bill of £183. An average poll tax payer in the Rhondda will be paying £50 less than the Welsh average, which amounts to £125. A couple will therefore be paying £250 which is considerably more than £183, and that is before the safety net is removed. The position next year will be bad and in future it will be even worse.
Does the Secretary of State realise that the cost of preparing for and eventually running the poll tax will be at least double that of the current system? Welsh councils expect millions of pounds more to help them over that hurdle.
The statement is a wretched milestone in the history of local government. Does not the poll tax represent reaction, not reform? It is a medieval tax which will hurt ordinary families in Wales. Is it not opposed by almost everyone, except the Government? Will not the poll tax shift the burden of local services on to those least able to pay? Ultimately, the poll tax will hammer the valley communities. It is all very well for the right hon. Gentleman to come here with a masking operation, but will not the poll tax bite most ferociously at the end of the transitional period?
This is a confidence trick. Did not the Scottish Office underestimate its eventual poll tax by 12·5 per cent.? Today we have heard fine words and clever packaging, but it is shaming to see a Secretary of State for Wales as an advocate of a poll tax. Is the right hon. Gentleman aware that what he proposes goes against the grain of Wales's concept of fair play? Where is the Government's mandate for this pernicious tax?
What of teacher shortages? Will there be additional funds to secure more modern language, science and maths teachers and more teachers in Welsh? Where are the additional major resources to cover the financial burdens of the Education Act 1988 and the implementation of the national curriculum?
This is the 10th year that a Conservative Secretary of State has stood before the House to make a statement on local government finance. The Government's record has been shabby, with a 12 per cent. real terms cut in money for our councils. In return for tax cuts to the rich, we have poorer services to our local communities, a demoralised education service, a housing crisis and social services stretched to breaking point.
We reject the poll tax even now. Will the right hon. Gentleman withdraw this unwanted tax?

Mr. Walker: I congratulate the hon. Member for Alyn and Deeside (Mr. Jones) on the thunderous cheers that he received at the end of those remarks. It is easy for someone in his position to say, "What a dreadful thing is being imposed on us." Wales is having 85 per cent. of all local government expenditure being financed by the Government and only 15 per cent. being put on the community charge. That would be the envy of England and Scotland, yet the hon. Gentleman says, "How terrible it is."
Let us consider what the local government associations have said about the talks and so on and about how disappointed they are at the figures. On every occasion—certainly in my lifetime, and I am sure the same is true of the hon. Gentleman—all local authorities under all Governments have been disappointed at the figures. I am sure that in the last few years they have been disappointed while we have been in power, when the support to local authorities has gone up by only a small amount in real terms, and I admit that.
But how they must have felt when the hon. Member for Alyn and Deeside was a Minister at the Welsh Office I cannot imagine. In 1976–77, the figure went down by 4 per cent. in real terms; in 1977–78 it went down by 8 per cent.; and in 1978–79 it went down in real terms by 4 per cent. If they are unhappy now, they must have been in tears when Labour was last in office. I suggest, therefore, that the hon. Gentleman should not concentrate on that aspect.
In terms of the retail prices index, it must be remembered that we are referring to the year 1990–91 and that we cannot be certain what the rate of inflation will be at that time. The hon. Gentleman referred to interest rates in relation to inflation. With house mortgage interest rates, it stands at 8·3 per cent., and without them it is 6 per cent.
In terms of local authority interest rates, a great volume of borrowing has been borrowing long, so the average increase in their interest rates is far lower than, for example, the average for house purchase. Thus, without that aspect they are much nearer the 6 per cent. than the 8·3 per cent. now.
I am the first to admit that the standard community charge, with the safety net, will mean an increase for the Rhondda. But I am glad to say that next year Rhondda will remain the lowest community charge authority in Wales—and, if it were in England, it would be the lowest community charge authority in England.
We appreciate that there are many people on low incomes in the Rhondda. The benefits under the rebate system will mean that in the coming year, with the safety net, the average payer in the Rhondda will obtain £72 more in rebate and service charge than he or she will pay in community charge. Therefore, instead of a rebate of 100 per cent. under the rating system, they will be getting a rebate of 130 per cent. under the new system. I hope that hon. Members will ensure that the people of Rhondda are aware of those benefits.
I am glad to say that it is estimated that businesses in the valleys will benefit as a result of the change in the business rate by about £10 million a year.

Sir Anthony Meyer: Is my right hon. Friend aware that I regard the community charge as unfair, unworkable and unwise? However, is he further


aware that there will be admiration and amazement throughout Wales at the skill with which he has managed to screw so much money out of the Treasury? There will be no advantage, indeed the reverse, for the poorest, though, and I am not clear what the position is for those just above the income support level. He has also managed to shoot the fox of the hon. Member for Alyn and Deeside (Mr. Jones). Is my right hon. Friend also aware that, by his skill in so lightening the burden, he has gone a long way to demolish the argument for the community charge—that it brings home to people the cost of local services?

Mr. Walker: It will mean that any local authority that involves itself in extravagant expenditure will hit community charge payers in that locality. There will, therefore, be a degree of discipline. I am pleased to say that in Wales there is no doubt that low-income families will benefit from the change in the system.

Mr. Ted Rowlands: Is the Secretary of State aware that, after all the fiddling and fudging, working people in Aberfan, Merthyr Vale and New Tredegar in my constituency, who are home owners but who do not receive benefits and are not likely to get rate rebates of the kind he mentioned, will face almost a doubling of their present rates bills as a result of the community charge?

Mr. Walker: In those areas people will still have the enormous advantage of 85 per cent. of all local government expenditure being met by the Government. Because of that, the people the hon. Gentleman has just described, who are on low incomes and not able to take advantage of rate rebates. will be better off. The average for the community charge in Wales will be £175, compared with £275 in England and, last year, £280 in Scotland. The people of Wales should realise that they are considerably better off.

Mr. Keith Raffan: Is it not very revealing that, when my right hon. Friend reached the section in the statement that concerns the dramatic benefit that it will bring to the 300,000 people in Wales who are on income support, it met with silence from Opposition Members? Is it not also revealing that the hon. Member for Alyn and Deeside (Mr. Jones) is as churlish as usual, and cannot pay tribute to my right hon. Friend for what he has done for those who are in real need in our community? It is a tremendous achievement and the Secretary of State deserves our thanks for that.
Returning to the local situation in north-east Wales, I disagree with my hon. Friend the Member for Clwyd, North-West (Sir A. Meyer). Does my right hon. Friend agree that Delyn and Rhuddlan borough councils could end up with community charges that are significantly higher than the Welsh average, because Clwyd, which is under Labour control, is a high-spending, improvident and chaotically managed county council?

Mr. Walker: As my hon. Friend says, during the past year Clwyd county council increased its expenditure, compared with its budgets and estimates, which was out of line with the majority of Welsh local councils. I hope that it will recognise that, if it continues to do so, that will be a considerable disadvantage to community charge payers in its county. I hope that it will budget and spend prudently during the coming year. As my hon. Friend says,

this is a total settlement which is of considerable advantage to the lowest income people in Wales. I am as surprised as he is at the Labour party's reaction to the statement.

Mr. Richard Livsey: Will the Secretary of State note that with the introduction of this iniquitous tax in my constituency—which is a rural area, like many other parts of Wales—the average poll tax of £175 per head will be an increase of £45 per head on the present rating system? Does he agree that his figure of £4 is way out for rural areas? It will be a case of paying Peter or robbing Paul. The non-domestic rate is forecast to increase by 15 per cent., which is double the rate of inflation, and will hit small businesses, which are the backbone of Wales.

Mr. Walker: That is not so. Small businesses will not be adversely affected by at last having a system in which the business tax is kept within any increases in inflation. Small and large businesses will prefer to have that stability. I repeat that to have a system where 85 per cent. of all local government expenditure is paid for by the Government is of considerable advantage to rural and urban areas in the Principality.

Mr. Gwilym Jones: I welcome the easing of the safety net arrangements which otherwise would have been more disadvantageous for the people of Cardiff. Can my right hon. Friend say whether, with the safety net, there will be lower transfers of funds between councils than there is with the existing rate equalisation mechanisms, that the safety net represents a lower amount of the help that will he received through income support, and that, at last, with the introduction of the far fairer community charge, every citizen in Wales will be able to measure his council against the all-Wales average of £175? If it comes to pass, as has been threatened in Cardiff, that we have a community charge of £275 or more, the responsibility will lie with the local councils who are making a direct attack on the least well off.

Mr. Walker: I think that it will have the result that fewer local authorities will be imprudent. In general, over the years, Welsh local authorities have been prudent compared with those in other parts of the United Kingdom. If individual local authorities decide to break with that, they will impose a considerable burden. Considering the system in terms of Wales as a whole, I decided to reduce the safety net provisions, and having obtained a settlement where 85 per cent. of finance comes from central Government, I considered it right to proceed as quickly as possible to get the full system into operation.

Mr. Donald Anderson: The Secretary of State gave the example of the relief to people on income support. Will he consider the gross injustice to those who are just above income support? I shall give him an example. In Landore, in my constituency, where the average rates are rather less than £200, a pensioner couple with a small private income from a works pension will probably have to pay more than double that. That has nothing to do with accountability. Surely the Secretary of State recognises that this is a gross injustice to people who are just above the level of income support.

Mr. Walker: When we finally agree the specific needs element with the local authorities and the figures are finally published, couples in Swansea who have been paying rates,


and who will pay the community charge, will, if anything, pay less than they do under the rating system. It is all very well to talk about injustice, but quite a few of the hon. Gentleman's constituents in that income bracket who have been widowed or who live alone have been adversely affected by the rating system.

Mr. Nicholas Bennett: Is my right hon. Friend aware that there will be much envy among English colleagues about the fact that he has, once again, secured a much better settlement for Wales than is the case for the rest of the United Kingdom? I assure him that my constituents will welcome the community charge because it is workable and fair. At the moment, only 50 per cent. of my constituents pay towards the services provided by their local authorities which they all enjoy and for which they have a vote. Under the new system, everybody will look to local authorities to be truly accountable for the services that they provide.

Mr. Walker: I think that there will be a clearer indication of local authorities' performance. There are problems associated with changing any system. There is no perfect system of local government—none has been advocated by any political party. In Wales, we felt that this system, in which we have to meet 15 per cent. of local authority expenditure through the community charge, and which includes rebates for low incomes, will produce both accountability for local authorities and a better deal for people on low incomes.

Mr. Alan Williams: I now understand why the Secretary of State gabbled so much when he made his statement. Will he confirm that, on the figures that he just announced, our beleagured councils will receive £14 million less than is necessary just to manage the cost of living increase, and £50 million less than is necessary to match the increase in their costs? After all his fine words, does not this mean that our councils will have to impose cuts in services or increase the poll tax—not to the £175 that the right hon. Gentleman mentioned, but by at least £20 beyond that, so that the true figure will be nearer £200?

Mr. Walker: If there is an increase of more than 7 per cent. on local governments' budgets for last year, it is very difficult to argue that they cannot prudently and sensibly meet their obligations.
I have already given the figures. Local authorities are treated much better now than they were during the time when the right hon. Gentleman was at the Welsh Office.

Several Hon. Members: rose——

Mr. Speaker: Order. I say to the two hon. Members who have been rising and who represent English constituencies that this is the United Kingdom Parliament and that they will be called, but I propose to give precedence to Welsh Members because this statement primarily affects Wales.

Mr. Allan Rogers: May I point out to the Secretary of State that the illustration he used—it was pointed out by his hon. Friend the Member for Delyn (Mr. Raffan)—of Clwyd county council concerned the budget for last year, which was set by a Conservative and independent-controlled council, and that a Labour authority took charge of the council only this year?
Local authorities in Wales will view this settlement of only £182 million in standard spending with dismay. As my right hon. Friend the Member for Swansea, West (Mr. Williams) said, it will mean real cuts in social services, education and housing.
I wish that the Secretary of State would not take the name of the Rhondda in vain. In Rhondda, a couple living with one child in a house will pay three times as much under the community charge as they would under the old rates system. It is wrong of the Secretary of State to suggest to the House and to the public at large that the people of the Rhondda will be better off: they will not be.

Mr. Walker: I am glad to say that next year the people of the Rhondda will have the lowest community charge of any area in England or Wales. I do not know how many of the hon. Gentleman's constituents are in receipt of full rate rebate now, but there are 300,000 such people in the whole of Wales, so I guess that there are at least 7,000 or 8,000 in his constituency. In view of all that the hon. Gentleman has said about the community charge, I hope that he will take great care to announce to the 7,000 or 8,000 people in his constituency on the lowest incomes that, instead of receiving 100 per cent. rebates under the rating system, they will receive 130 per cent. rebates under the community charge this year and 114 per cent. thereafter. I hope that the hon. Gentleman will communicate that improvement to his electors.

Mr. Ieuan Wyn Jones (Ynys Môn): It is a bit much of the Secretary of State to come to the Dispatch Box and give us the average figure for Welsh local authorities and then proceed to give us three examples of authorities that he says will benefit next year, since he gave us no examples of local authorities that will not benefit and in which consequently people will pay more than the average standard poll tax. The right hon. Gentleman should do his duty to the House and the people of Wales and publish a list, authority by authority, telling us how much people in each will pay—and how much people in the Anglesey borough council area will pay next year.

Mr. Walker: I have already published a list based on last year's, figures since when I have adjusted the safety net. We still have to agree the final distribution with the local authority associations, and I hope to do that in the near future. It was the local authority associations—they are not, in the main, under my party's political control—which asked that no indicative figures should be issued until the figures are finalised. When they are, I shall be delighted to send out the details.

Mr. Donald Coleman (Neith): During the past two years, the right hon. Gentleman has had some association with us in Wales. In his reply to my hon. Friend the Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) he seemed to equate home ownership and owner-occupation with income. But many of those who live in these properties are in impoverished circumstances, and the right hon. Gentleman should recognise that.
What are the figures that will affect all of us in all our valley communities? Why has the right hon. Gentleman not brought them here, as his right hon. Friend the Secretary of State for the Environment did yesterday? Surely this is an incomplete statement. If the right hon. Gentleman does not have the figures, he should not have come here and made it.

Mr. Walker: I shall convey the hon. Gentleman's remarks to the leaders of the Welsh local authority associations, virtually all of whom are of his political persuasion. I shall tell them that they were wrong to demand what they did—if that is the substance of the hon. Gentleman's attack.
A few weeks ago, in reply to a parliamentary question, we published the best estimates available; they are in Hansard. As soon as we have agreed more detailed and accurate figures with local authorities, I shall be happy to issue them. They tell a good story: when the Government are paying 85 per cent. of all local government expenditure. that is something to be proud of——

Mr. Rhodri Morgan: On a point of order, Mr. Speaker.

Mr. Speaker: Order. Would it not be better if the hon. Gentleman raised this in the form of a question? I shall take it if it is a point of order.

Mr. Morgan: This is the fourth time since I have been in the Chamber that the Secretary of State—I am sure unintentionally—has misled the House by saying that 85 per cent. of grant will come from central Government. That is not what his statement says——

Mr. Speaker: Order. The Minister will have to deal with that.

Mr. Roy Hughes: Where are the high-spending, Labour-controlled authorities which the Government have been so busily criticising in recent weeks and months? I venture to suggest that, in Wales, they just do not exist. Our local authorities have had to contend, since the Government were elected in 1979, with the loss of no less than £990 million in rate support grant payments.
When will the right hon. Gentleman recognise that the poll tax is essentially regressive? The poorer sections of the community—people in low rateable value homes—will have to pay the main burden, and the right hon. Gentleman's safety net is not adequate.

Mr. Walker: When the system has finally settled down and, at the next general election, the people of Newport are offered the choice of returning to the present rating system or sticking to the poll tax, I have a feeling that the hon. Gentleman will not be eager to proclaim a return to the rating system for Newport.
Three hundred thousand of the lowest income group will directly benefit by the proposals.
I have already paid tribute to Welsh local authorities. One of the important reasons why I have been able to negotiate the sort of settlement that I have is that I have been able to show that local authorities in Wales have acted responsibly and prudently under the system that they have enjoyed in the past.

Mr. Alan W. Williams: How many gainers and how many losers will there be when the poll tax is introduced? In particular, who are the losers? I grant the right hon. Gentleman that the bottom 14 per cent., on income support, will benefit from the rebate, but the next 30 or 40 per cent., on below average pay, in low rateable value houses will be hit hard.

Mr. Walker: The 80 per cent. rebate for 300,000 people goes to the lowest income group, but the rebate system deals with many more people on lower incomes than I have

mentioned. Many single people, widows and so on will benefit. Households that include three or four adults will be at a disadvantage if they earn tolerable levels of income. That is the nature of the mixture.

Mr. Neil Hamilton: As one born, bred and educated in Wales, and representing a constituency only 16 miles from the Welsh border, I congratulate my right hon. Friend on the characteristic dexterity with which he presented his statement today, and I counsel him not to be too savagely destructive of the hon. Member for Alyn and Deeside (Mr. Jones), because my right hon. Friend may be in danger of creating a residual sympathy for the hon. Gentleman which might not otherwise exist.
In due course, my right hon. Friend may face some criticism from authorities and from Members representing constituencies which will pay into the safety net during the coming year. I ask my right hon. Friend on the whole to disregard these criticisms because people in the vast majority of these areas will pay no more than they would otherwise have paid under the rating system, and by and large they will benefit significantly in the future.

Mr. Walker: I agree with my hon. Friend that, once the safety provisions have come to an end and the whole system is in operation, many parts of the Principality will have considerable benefits from the change in the system.

Mr. Geraint Howells: Having listened to the comments of hon. Members on both sides of the House, does the right hon. Gentleman think that the Government made the wrong decision to impose the poll tax on the people of Wales?

Mr. Walker: The measures and the terms of the settlement which we announced are good for Wales, Welsh industry and Welsh business.

Dr. John Marek: I hope that, on reflection, the Secratary of State will admit that he has done a disservice to the House by making a statement and allowing questions to be asked without the facts and the details being available to any Member. I hope that he will accept that this is not a good practice and that it should not be followed in future years.
Can the right hon. Gentleman tell me about the 100 per cent. rebate for people on income support? Are there any areas in Wales where the 20 per cent. increase that those on income support will have to pay will not be completely rebated?

Mr. Walker: I know that the hon. Gentleman will be delighted to hear that no one in Wales will be in that category. All the people will be net beneficiaries.

Mr. Ron Davies: I hope, Mr. Speaker, that you have noted our complaints about the inadequacy of the statement. I hope that, when the detailed information is available on a district-by-district basis, you will be responsive to any requests for a further opportunity to question the Secretary of State—whoever it may be—on those arrangements.
Will the Secretary of State acknowledge that the safety net is nothing more than a temporary, hidden subsidy and that, when it is removed, the poll tax will be revealed as having a built-in mechanism to levy increases year by year on Welsh communities?
Will the right hon. Gentleman acknowledge a point that has been made by several of my hon. Friends? We


obviously welcome the fact that 14 per cent. of the population will receive a full rebate, but that rebate will be raised at the expense of people on low incomes. Does the right hon. Gentleman recognise that he is making the poverty trap which applies to many of our low-income earners considerably greater? In publishing the district-by-district basis of the poll tax, will the right hon. Gentleman take it upon himself also to publish a table showing the impact of this new poverty trap on our Welsh communities?

Mr. Walker: The information to which the hon. Gentleman refers has been made available in considerable detail in reply to parliamentary questions. The updated information has not been issued, at the request of local authority associations, and they were probably quite right to make that request. That information will not be available until the final settlement is reached.
The hon. Gentleman talked about the rebate. I cannot do this through the political party machine or through the Government machine, but I shall do my best to ensure that the Conservative party in the hon. Gentleman's constituency distributes to every household the leaflet on the poll tax which he issued and compares the outrageous predictions that he made to low-income people, which must have scared the life out of them, with what will happen.

Mr. John P. Smith: Does not the Secretary of State recognise that the overwhelming majority of poll tax payers in Wales who will benefit are the people who need help the least? That is why this tax is so obviously unfair. That is why it was rejected so decisively in the Vale of Glamorgan, which is one of the most affluent constituencies in Wales.

Mr. Walker: In fairness, I thought that at the time the hon. Gentleman gave a number of other reasons why he managed to succeed in the Vale of Glamorgan. If that was the reason, I hope that when the community charge is fully implemented in the Vale of Glamorgan he will make it clear to the electors well before the next general election that he would prefer to return to the present rating system or the system that the Labour party advocates. That will help us considerably in winning back the seat.

Mr. Win Griffiths: To follow the theme of other questions that the Secretary of State has not yet answered successfully, will he confirm that the principal gainers will be those on high incomes and the principal losers will be those on low incomes but who are above any income support level? Many people on high incomes in my constituency are totally against the imposition of the poll tax, and I would be willing to say that in any election manifesto at the next election.

Mr. Walker: When the hon. Gentleman meets those people, he should explain that at least in Wales 85 per cent. of local government expenditure is financed by the taxpayers. Therefore, the hon. Gentleman's argument does' not prevail when only 15 per cent. of all the costs are met out of the community charge and 85 per cent. are met by the taxpayer.

Mr. Paul Flynn: We have had another piece of meaningless trumpeting by the Secretary of State

in his abuse of statistics again and his claim that those on income support will benefit in some way from the Government's actions. He says, wrongly, that payments will include certain amounts, but people on income support—it is a miserable level—already receive those amounts and have no idea that there is meant to be compensation.
It may be true that certain couples will gain, by a few pence, because of the quality of local government in Wales and their prudent and good running of local matters over the years. Where is the trumpeting when people on income support in Wales lose out more than those on income support in the rest of the country? Where was the trumpeting when there were cuts of £650 million in housing benefit and when people lost out on transitional payments? Half a million pensioners in this country, many of them in Wales, had not a penny increase in 1987 or 1988 and may well go on through the next year and the year after without a penny increase. It is an outrage for anyone to suggest that the Government's actions are helping people on income support, whose income has been cut year after year by the Government.

Mr. Walker: The hon. Gentleman's argument that the 20 per cent. rebate has been paid before the community charge has been introduced and therefore should he discontinued gives us a good insight into how the Labour party will attempt to play this matter. As the hon. Gentleman knows, this system for people on low incomes is far better than the rating system.

Mr. Tony Marlow: Speaking as the husband of a Welsh woman, should it not be a matter of shame to every decent Welsh woman and Welsh man that, when my right hon. Friend announces a settlement whereby a couple in the Rhonnda will pay signficantly less than the average individual in England and 7,000 or 8,000 people in the Rhonnda will pay about 70p a week and, as my right hon. Friend said, be better off, all that the Labour Front-Bench spokesman can do is whinge? Is it not the case that in Wales the average person will pay £3.50 a week and 300,000 people will pay a mere 70p a week for the whole range of local government services? Are they not getting an incredibly good buy?

Mr. Walker: The people of Wales have a considerable advantage under this settlement, with so much of it centrally financed. Wales has considerable problems because a large number of people are on very low incomes. This will be a far better system for them than the rating system.

Mr. Alun Michael: I was interested in the right hon. Gentleman's answer to the question put by my hon. Friend the Member for Vale of Glamorgan (Mr. Smith). Does not the right hon. Gentleman accept that the poll tax is equally unpopular in Penarth, which is the other part of the Vale of Glamorgan and which falls in my constituency, because even gainers regard it as unfair and unacceptable? That is why we are not whingeing but winning.
The right hon. Gentleman is patronising and unfair to local authorities when he says that they are spending above the planned level. Does he accept that, with 4 per cent. inflation as the level projected when the budget was set, with poll tax preparation costs and with central Government decisions creating extra costs in preparing for


education reform, increased demand on social services and so on, local authorities are showing remarkable restraint as well as making positive contributions to efficiency reviews in which the right hon. Gentleman, like Oliver Twist, is always asking for more?
Perhaps we should commiserate today with the Secretary of State who has had another bad afternoon. Will he accept that the statement lacks content, facts, figures and reality for those of us who have knowledge and experience of local government finance? Will he accept that under the smooth surface lurks a heavy burden for many of the low paid and especially for those who fall into the poverty trap, which is the Government's particular creation?

Mr. Walker: I only hope that I shall have many more afternoons as bad as this afternoon. The sight of Labour Members, having heard the degree to which those on low incomes in Wales will benefit, is a sight that I wish could have been televised. When, in a rather speedier time than anticipated, the system is operating fully in Cardiff, I shall be interested to see how many of the hon. Gentleman's constituents want to go over to the old system or the incredibly ridiculous system his party advocates at present.

Education (No. 2) Act 1986

Mr. Alan Williams: I beg to ask leave to move the Adjournment of the House, under Standing Order No. 20, for the purpose of discussing a specific and important matter that should have urgent consideration.
It is certainly specific, as you know, Mr. Speaker, because I sent you a copy of this letter. It is a preposterous letter which has been issued by Conservative Central Office, setting out its plans to subvert the Government's own education legislation, which forbids political indoctrination in our schools. In this context, it is worth bearing in mind the intervention of my hon. Friend the Member for Blackburn (Mr. Straw), the shadow Education spokesman, during the European elections, to stop the circulation of certain Conservative documents to our schools.
The matter is important because section 44 of the Education (No. 2) Act 1986, which was introduced by this Government, states categorically:
the governing body and head teacher"—
and I emphasise those posts—
of the school shall forbid … the pursuit of partisan political activities … and the promotion of partisan political views in the teaching in the school.
Yet in this letter, of which I gave you a copy Mr. Speaker, from Conservative Central Office, a Mr. John Spiers says that he has been appointed to edit, at the request of the deputy chairman of the Conservative party who is a Minister in this Government, a journal for Conservative school governors.
I want to quote one sentence from the letter. It says:
We hope that it will equip Governors"—
those who are supposed to be monitoring political activity—
to manage schools so that head teachers"—
who also have the same responsibility—
and teachers are motivated to make a Conservative"—
and I emphasise that it is spelled with a capital "C"—
educational agenda effective in their day-to-day work".
Clearly, the letter must be important because the heads of Conservative Central Office—the chairman and vice-chairman of the Conservative party—are both appointed by the Prime Minister. It is important because both were Ministers at the time when the legislation was passed and it is important because they are both Ministers now. It is also important because it aims to subvert and pressurise the very people the Act forbids to allow any partisan politics in our schools and because we need to know exactly how this vindictive and malevolent Government intend to motivate teachers to carry out their political dirty work in schools.
I suggest that it is urgent because on Monday it is quite likely that the present Secretary of State for Education may himself be chairman of the Conservative party and he could be presiding over this attempt to create a Conservative fifth column in our schools.

Mr. Speaker: Order. Three minutes, please.

Mr. Williams: I am making my final point, Mr. Speaker. The matter is urgent because we go into recess next week and it will be three months before we have a chance to discuss it.

Mr. Speaker: The right hon. Member for Swansea West (Mr. Williams) asks leave to move the Adjournment


of the House, under Standing Order No. 20, for the purpose of discussing a specific and important matter that he thinks should have urgent consideration, namely,
the implementation of section 44 of the Education (No. 2) Act 1986.
As the House knows, under Standing Order No. 20, I have to take into account the requirements of the order and to announce my decision without giving reason to the House. I have listened with care to what the right hon. Gentleman has said, but I regret that the matter he has raised does not meet the requirements of Standing Order No. 20 and I cannot, therefore, submit his application to the House.

Mr. Jack Straw: On a point of order, Mr. Speaker. Your ruling is, of course, accepted by the whole House, but as the matter is plainly unlawful in the light of section 44 of the Education (No. 2) Act 1986, as it invites Governments to ensure that head teachers are motivated

to make a Conservative education agenda effective in their day-to-day work and as the Parliamentary Under-Secretary of State for Education and Science, the hon. Member for Coventry, South-West (Mr. Butcher) is in his place, can he be invited to make a statement as to whether the letter has the support of Government Ministers?

Mr. Speaker: That is not a matter for me. We have a heavy day ahead of us.

BILL PRESENTED

TELECOMMUNICATIONS (PREMIUM RATE SERVICES AND CONSUMER REPRESENTATION)

Mr. Terry Lewis presented a Bill to amend the Telecommunications Act 1984 with respect to the provision of advice about premium rate services and to provide for consumer representation on advisory committees: And the same was read the First time; and ordered to be read a Second time on Thursday 27 July and to be printed. [Bill 191.]

Orders of the Day — Electricity Bill

Lords amendments considered.

Ordered,
That the Lords Amendments to the Electricity Bill be considered in the following order, namely, Nos. 4, 5, 9, 10, 95, 14, 101 to 108, 22, 25, 26, 51, 52, 55, 56, 129, 140, 27, 108A to 114, 118, 3, 2, 100, 62 to 65, 6, 90, 7, 119 to 128, 130 to 139, 141 to 143, 11 to 13, 15, 16 to 20, 115 to 117, 53, 54, 57, 58, 59 to 61, 66, 67, 68, 69 to 74, 75 to 77, 144 to 153, 174, 154 to 157, 80, 163 to 167, 91, 92, 168, 93, 94, 169, 170 to 173, 175 to 178, 179 to 181, 96 to 99, 158 to 162, 21, 81 to 89, 28 to 50, 78, 79, 1, 8, 23 and 24—[Mr. Michael Spicer.]

Mr. Deputy Speaker (Sir Paul Dean): I have to advise the House that Lords amendment No. 10 involves privilege.

(1) The Director may, after consultation with public electricity suppliers and with persons or bodies appearing to him to be representative of persons likely to be affected, from time to time—
(a) determine such standards of performance in connection with the promotion of the efficient use of electricity by consumers as, in his opinion, ought to be achieved by such suppliers; and
(b) arrange for the publication, in such form and in such manner as he considers appropriate, of the standards so determined.

(2) Different standards may be determined under this section for different public electricity suppliers.'.

The following amendments to amendment (a): (i) in line 1, leave out 'may' and insert 'shall'.
(ii) in line 5, leave out
'as in his opinion ought to'
and insert 'which shall'.
(iii) in line 11, at end insert
'and
(c) shall set a date by which these standards must be achieved and shall apply such sanctions as appears necessary should these standards not be met.'.
Government amendments (b) to (e).

Mr. Parkinson: At present, the only duty that rests on anyone to promote energy efficiency is the duty on the Secretary of State. As a result of the Bill, the range of responsibilities for promoting energy efficiency will be widened and strengthened considerably. The statutory duty will still remain on the Secretary of State, but, in addition, the new Office of Electricity Supply, which will be a very powerful body, and its regulator will also have a statutory duty to promote energy efficiency and for the first time the area boards will have a duty to publish information about energy efficiency and to make it available to their customers. These duties all deal with the consumption of electricity, and with the saving of electricity and energy by users.
However, there is a fourth important pressure built into the Bill and into the structure created as a result of the Bill. It is a major pressure to produce electricity more efficiently. At present, we have a Central Electricity Generating Board which has monopoly powers and operates on a strictly cost-plus basis. Whatever its costs are, it simply passes them through to the customer.
Under the new structure there will be substantial competition from day one for the business of the area boards in both England and Scotland. The Scots are only

Lords amendments Nos. 4, 5, 9, 10, 95, 14, 101 to 108, 22,25, 26,51,52,55, 56, 129, 140, 27, 108A, 109, 109A, 110 to 114 and 118 agreed to.

Lords amendment: No. 3, before clause 3, insert the following new clause—Promotion of efficient use of electricity—
. The Secretary of State and the Director shall require each of the public electricity suppliers to make and produce evidence to the Director showing that he has made such arrangements as will promote the efficient use of electricity and may direct any public electricity supplier to take specific action in this area and, if appropriate, may refuse or amend any application for tariff increases or major capital projects.

The Secretary of State for Energy (Mr. Cecil Parkinson): I beg to move, That this House doth disagree with the Lords in the said amendment.

Mr. Deputy Speaker: With this it will be convenient to discuss Government amendment (a), a new clause—
'Promotion of efficient use of electricity—

just finding out that that is a serious possibility. [Interruption.] If the hon. Member for Glasgow, Cathcart (Mr. Maxton) will listen, he may get a surprise.

PowerGen has just written to every major company in Scotland offering to supply them with electricity. National Power is following suit. For the first time major companies and boards in Scotland are being pursued by generators seeking their business. Therefore, there is competition in generation. As fuel represents 60 per cent. of the cost of all electricity generation, the pressure is on generators to compete by using fuel efficiently.

Mr. John Maxton: Will the Secretary of State give way?

Mr. Parkinson: I shall not give way because we have agreed to make short speeches as the hon. Member for Sedgefield (Mr. Blair) is under the weather.
People used to say, "Where there's muck there's money", but pollution in electricity production is extremely expensive because the less efficiently fuel is used and the worse the technology, the greater the pollution and expense. Therefore, competition and efficient use of fuel run hand in hand with conserving fuel and reducing pollution. That is an important aspect of the new structure that the Bill creates. The company that uses fuel efficiently will have an advantage over its competitors and there will be real pressure for efficient production of electricity.
Their Lordships felt that more should be done and they amended the Bill. I ask the House to reject their amendments and replace them with our new clause. It is not disputed that their Lordships' proposals are defective. The person who proposed them has accepted that. The subsequent amendments only made matters worse. The


Select Committee has confirmed that the amendments are unworkable and unsatisfactory, and nobody in the House will be tempted to dispute that.
The amendments are ineffective because they were based on American experience and were designed to discipline a system that we do not have here. They are an attempt to import into this country a set of rules and regulations designed for an over-regulated, vertically integrated industry. Their Lordships' failure to understand that has led them to produce this dog's breakfast of amendments. Everyone accepts that they are ineffective and unworkable.
I wish to give the House some of the reasons why the amendments are ineffective. First, they are built round the concept that the Secretary of State or the director general has the power to approve tariff increases and major capital projects. Nowhere in the Bill do we have that power. Moreover, because it is assumed that it is a vertically integrated monopoly the amendments assume that generation is part of distribution. In fact, they are separate. The generators will build the new capacity. The amendments do not include any arrangements to deal with that, but deal exclusively with public electricity suppliers, who will not produce new capacity.
We recognise their Lordships' desire to see the commitment to energy efficiency in the Bill strengthened and we recognise that my hon. Friend the Member for Exeter (Mr. Hannam) and others agree with that. Although they think that least-cost planning would be a mistake, they want the Bill to be more specific about how the new duties will be carried out.
In the new clause and in the two revised conditions to the licence we spell out exactly how the director general will carry out his new duties to promote energy efficiency. Each public electricity supplier will have a duty to set performance standards for the promotion of energy efficiency. He will monitor performance and ensure that the standards are met.
Condition 17 supports the new clause and binds the company in the licence to meet the standards set by the director general. Condition 18 spells out clearly how the public electricity supplier will have to carry out his duty to make information available to the customer. In a code of practice which will be part of condition 18 we shall spell out how the public electricity supplier must meet his obligation to provide information. It will be specific and will include the need to maintain a telephone answering service and an office or bureau to supply information. It will give flesh to the commitment that the Bill imposes on the public electricity supplier to provide information.
The new clause spells out clearly the two new specific duties imposed on both the regulator and the public elecricity supplier. Specific action will be taken to set standards, collect information and enforce the standards.
The hon. Member for Sedgefield has conducted a campaign inspired by Mr. Mandelson. He used Mr. Mandelson's Monday morning spot on the "Today" programme to push out his half-thought-out ideas. He made great play of the fact that gas regulators have duties but have not carried them out. We have had discussions with the Director General of Ofgas, who finds his powers too vague and general. He believes that the powers spelt out in our amendments and in the Bill would enable him

effectively to promote energy efficiency and he intends to seek such powers. He recognises that his present powers are inadequate and need to be strengthened and that the powers set out in this Bill would enormously improve his position.
The hon. Gentleman and some of his hon. Friends have suddenly discovered least-cost planning. They see it as the answer to their predicament of having no energy policy and are suddenly rushing madly towards it. Yesterday the hon. Gentleman gave a series of quotations, all garnered from regulators in America. In America the people who have this overweaning power claim that they use it extremely well. The hon. Gentleman said that that proved conclusively that least-cost planning is widely accepted and admired in America, but it has far more critics than supporters. Its supporters are mainly people who enjoy using the powers and its critics are mainly those who suffer under them. I could give many more quotations than the hon. Gentleman gave yesterday.
I shall read some evidence given by Professor Joskow, who is a highly respected professor of economics at the Massachusetts institute of technology to the House of Representatives sub-committee on energy and power in March 1988. He said:
My analysis leads me to conclude that the broad implications of this proposal is likely to lead to several undesirable outcomes. In particular, it could result in higher energy prices, inequitable … electricity rates and incentives for inefficient conservation investments. My testimony does not argue that there is no role for utilities in encouraging conservation. The main point is that this proposal is the wrong way to identify and implement fair and efficient energy conservation programmes.
Let us hear no more nonsense about that system being universally admired throughout the United States. It has been adopted by only three states that have competition in generation. It has been ignored by more than 40 states and is widely regarded by many people as a disaster and a further strengthening of a deeply over-regulated regime.

Mr. Tony Blair: rose——

Mr. Parkinson: The hon. Member for Sedgefield (Mr. Blair) can make his speech in a couple of minutes. This is not the Old Bailey. The hon. Gentleman is not Rumpole and I am not in the dock. He will have an opportunity to make his speech in a moment.

Mr. Alexander Eadie: On a point of order, Mr. Deputy Speaker. Lords amendment No. 3 is important. The arrogance of the Secretary of State in refusing to give way is almost unknown. The Secretary of State should be informed that he is a servant of the House, not the master of it.

Mr. Parkinson: The hon. Member for Midlothian (Mr. Eadie), not for the first time, is misinformed. I was asked, on behalf of the hon. Member for Sedgefield, to keep my speech short because he was feeling under the weather. He therefore wanted me to make a short speech, which is why I am not giving way. Perhaps the hon. Member for Midlothian should break the habit of a lifetime by thinking before he speaks.

Mr. Blair: I am happy for the debate to continue. It is absurd for the Secretary of State to say that he will not give way in a debate on a Lords amendment. I ask him to give way on the point that he is making.

Mr. Parkinson: I thought that I was helping the hon. Member for Sedgefield. I hope that the hon. Gentleman will not forget that I shall be replying to the debate and shall therefore be able to answer his questions. I am happy to give way to the hon. Gentleman; I thought that I was being helpful.

Mr. Blair: The Secretary of State said that the view in the United States is that least-cost planning does not work. Regulators in 29 different states apply least-cost planning, including California, which is the largest state. The only effect of Lords amendment No. 3 is to allow the regulator, if he wishes, to introduce such a concept. It does not oblige him to introduce such a concept; therefore, the regulator can act accordingly.

Mr. Parkinson: Lords amendment No. 3 assumes a power that the regulator and I do not have. If the regulator decided to intervene in tariffs and stop capital development he would be exercising a power that does not exist in the Bill. Therefore, the amendment is fundamentally misconceived. The hon. Member for Sedgefield will recognise that Ministers only have the powers that Parliament gives them.
I am saying not that least-cost planning does not have supporters but that it has many critics and is designed for vertically integrated monopolies, which we are determined to avoid. It is a by-product of the over-regulated and vertically integrated American system. Ironically, because the American system is so strong and based mainly on the rate of return, an incentive is built into it to create over-capacity. Least-cost planning was introduced to correct a distortion that was built into its over-regulated system. Our competitive system of generation and the Government's powerful amendments and new clauses offer a better opportunity of providing worthwhile energy conservation.
Throughout our debates, security of supply has been taken for granted. Conservationists ignore the need to maintain security of supply. The Government do not deny that conservation has a role to play, but we believe that the Bill creates more powers for more people to promote energy efficiency than have existed hitherto. We are not prepared to put the security of the system at risk. Conservation must be balanced with the need to maintain security of supply, which is what the Bill aims to do. Evidence from America shows that one of the by-products of least-cost planning is an increase in the danger of blackouts. We believe that our policy offers a much more balanced and sensible approach.
I ask my right hon. and hon. Friends to reject Lords amendment No. 3 and accept the Government amendments, which recognise the vital importance of energy efficiency and provide the people who can do something about it with the specific powers to do so.

Mr. Blair: I shall begin by setting out the matters on which, apart from the Government, we all agree. We agree that the greenhouse effect and global warming is a serious environmental problem—perhaps the most serious that we face. We agree that energy efficiency is the best method of combating it. The question is whether Lords amendment No. 3 or the Government's amendment is the most effective to promote energy efficiency.
There can be no more stark contrast than between the two amendments. Lords amendment No. 3 would impose energy efficiency duties on suppliers and regulators. It

would give the regulator freedom to direct suppliers to do whatever is necessary to carry out their duties, and it backs that up with tough new penalties. By contrast, the Government's amendment does not even impose an obligation on the director general; it merely leaves it to his discretion. That power must be exercised from time to time, but no specific penalties are attached to the Government's amendment. The difference in the protection that the two amendments offer is the difference between wrought iron and writing paper. The argument that the Government's amendment is going half or quarter way to meeting the arguments advanced in the other place is absurd. It would surely require powerful arguments for rejecting Lords amendment No. 3 in favour of the weak Government amendment.
The Secretary of State said that everyone concedes that Lords amendment No. 3 is technically unworkable. I do not concede that it is unworkable. It has been changed slightly, and I believe that it could work. If the Secretary of State's only objection to it is that it gives him a power to increase tariffs—the Secretary of State does not have such power under the Bill—it could simply be amended. The idea that the Lords amendment can be entirely ruled out on that basis is absurd. It probably has broader support than any amendment that has come from the other place in recent times. It has the support of almost all the environmental groups, such as the Council for the Protection of Rural England, Friends of the Earth and the World Wildlife Fund. It was supported by the House of Lords Select Committee on Energy, which moved it in the other place. The House of Commons Select Committee, in paragraph 5 of its short but valuable report on the Lords amendment, said:
There are a number of basic principles in the Lords Amendment which we believe that the Government should now ensure are inserted into the Electricity Bill. These are:
(a) Public Electricity Suppliers must be under a statutory obligation to promote more efficient electricity use.
(b) That statutory obligation must be reinforced by penalties to ensure that it is met.
(c) The most effective penalty is for tariff increases to be refused, especially where such increases, caused by additional supply investment, could have been avoided by investment in energy efficiency."
At that infamous No. 10 seminar on global wanning, energy efficiency was given as the most effective way to combat the greenhouse effect. If the test for the amendment were either public support or scientific support, it would be carried overwhelmingly.
The Government's position has been characterised by a malign reluctance to have anything to do with the notion of energy conservation. When this was first raised months ago, the Government's response was to rubbish it. We were told that conservation was all about turning the lights off and that, in so far as it was relevant, it would be left to market forces, leavened with a little persuasion. The Government were then hoist with their own petard. Having made a big issue of the greenhouse effect, as concern about it grew and it became clear that energy efficiency was the best way to deal with it, and as the inadequacy of mere persuasion of the market forces became self-evident, the Government were forced more and more into having to concede something to salvage their credibility.
In other words, this long tale of Committee stage, Report stage and passage through the other place with amendments from it is not a tale of a Government who are


desperate to carry out the common will and anxious to get first in the field with energy efficiency. They have had to be dragged, kicking and screaming into this position. Driven to it, disbelieving and reluctant, acting from expediency rather than commitment, they have come up with their amendment today.
The Government's amendment imposes no obligation on the regulator—it simply gives him a power. He may use it if he wishes, but he need not if he does not. If the regulator were so minded, he need never use the power. The idea that this amendment matches the seriousness of the problem is absurd. The regulator can do much if he is so minded. He can determine standards of performance in connection with the promotion of the efficient use of electricity by consumers. In other words, he can intervene, but only to set standards by which suppliers must promote the efficient use of electricity by consumers. There is no direct power to make the suppliers do anything.
Would the regulator, under the Government's amendment, be able to set targets for the reduction in energy demand? Would he be able to direct suppliers to use more energy efficient power generation? Would he even be able to order suppliers to provide incentives for customers to purchase more energy efficient equipment? If, as I believe, it is doubtful that he can do any of these things, then we do not have a brand new amendment and new clause designed to put energy conservation and energy efficiency on the energy map; we have simply a round-about way of saying that more and better information should be disseminated, with bigger and better leaflets and more of them. In other words, we shall not have the teeth that the Lords amendment assumes is necessary to promote energy conservation and efficiency. We shall simply have a publicity campaign that may be better than the publicity campaigns that we have had before, but still one that falls woefully short of what is required to do the job.
Many Conservative Members have signed the early-day motion supporting the Lords amendment. They should be aware that the idea that the Government amendment embodies the spirit of the Lords amendment and is almost a redrafting of it—the same spirit but in different words—is fatuous. If we compare it with the Lords amendment, we see immediately that the latter carries an obligation. That is the first difference. It allows interference with tariff increases and hard and harsh penalties. That is the second difference. It allows interference with new capacity, which is the building of new power stations. The Secretary of State may say that least-cost planning does not work in the United States, but many think that it works extremely well. However, the question is whether we should allow the regulator, if he believes that it is right, to interfere with the planning of new capacity if energy conservation would yield better results.
It cannot seriously be said that the Government do not mind taking powers where they are necessary. For example, clause 36 gives the Secretary of State wide powers to manage power stocks at power stations. Clause 38 obliges him to give consent to the new power stations. Clause 41 sets out standards of performance generally. The nuclear levy is the most direct interference with the market that could be imagined. Whatever other reason the

Government have for saying that the Lords amendment should not be accepted, it cannot be because they are opposed to intervention.
5.45 pm
The Chairman of the Select Committee said that he believed that we were hanging on by our fingertips in relation to the problems of global warming. If the problem is that serious, should we be afraid of taking powers such as those in the Lords amendment? If it is that serious, can those powers be said to be of a lower order of significance than fuel stocks or the need that the Government see to protect nuclear power, with which they agree although we may not? It is absurd to say that these things are of tremendous importance whereas global warming, which is acknowledged to be the most serious environmental problem that we face, is not.
I do not know whether the director general quite understands the effect of the Government amendments. However, the record of British Gas is an appalling indictment of the power that the Government have given that company. The regulator has not made a single directive concerning British Gas over the years since privatisation. Only four people, although they are good people, work in the marketing division of British Gas, which has a turnover of £7·5 billion, but spends only £4 million on energy conservation.

Mr. David Clelland: Is not privatisation of energy industries incompatible with energy conservation and efficiency, as we are now seeing with British Gas? The simple fact is that people will not be interested in investing in a private company that has a statutory duty to encourage its customers not to use the product that it is trying to sell. That is why the Secretary of State will not introduce such statutory duties and the amendment that he has tabled will not work.

Mr. Blair: My hon. Friend is right. The Secretary of State seems to believe that the commercial impetus of a privatised electricity system will be to promote energy efficiency and conservation. That is a curious idea. I should have thought that the commercial impetus would be to sell as much electricity as it could. What has happened with British Gas over the past few years makes it difficult to sustain the notion that it sees such a policy as being to its commercial advantage.
The issue of the environment and the central role of energy efficiency in its conservation will not disappear. People will ask why the Government are opposing the Lords amendment when there is so much support for it. The answer is simple. The Government's agenda is privatisation, but the agenda of the British people is the environment. Faced with a choice between the environment and privatisation, the Government have chosen to put privatisation first. There is no more important environmental test of this Parliament than the acceptance of the Lords amendment.
Many of the Conservative Members who have put their names to the early-day motion support the concept of privatisation, whereas Opposition Members believe that the privatisation proposals are one great unedifying shambles. They have already caused higher prices and chaos within the industry, and the provisions on nuclear power have met with condemnation from every quarter. But even if one accepts the principle of privatisation, what possible rational argument can there be for adding to the


litany of failure to which the Bill has already given rise by refusing the most coherent and effective method of fighting our common single greatest environmental problem?
I therefore call upon all Conservative Members who acknowledge the seriousness of the problem to support the Lords amendment in the Lobby. It is one thing to sign early-day motions, but they will not bring home to the Government the credibility and seriousness of the threat unless they are prepared to put their votes where their mouths are. The Government may win the vote tonight, but if they do it will be on the basis of arguments that have been universally discredited. They have been given the single most significant environmental test of this Parliament. They have sat that test and they have failed.

Sir Ian Lloyd: I felt that it would probably be less than principled of me if I did not take part in this debate because of the strong position that the Committee of which I am Chairman has taken on the amendment and the views expressed in the report that we published to which the hon. Member for Sedgefield (Mr. Blair) referred.
Before I get down to the nuts and bolts of the argument, let me put one thing straight. The hon. Member for Sedgefield referred very generously to the simile that I had used about global warming—that we were clinging by our fingernails to the cliff. As I explained at the press conference, the simile, though a great one, was not mine. It was the fine British historian Arnold Toynbee who said that all civilisations cling to the cliff for one reason or another, and ours is clinging to the cliff because of the complex and dangerous technological fix in which we find ourselves.
The Secretary of State said that the Select Committee had confirmed in its report that the amendment was defective. I must point out that, having accepted that, we said that the objectives that the amendment sought to achieve were most powerful and deserved careful consideration by the Secretary of State and his Department. I adhere to that view, although, broadly speaking, I welcome much that the Secretary of State has done during the passage of the Bill to reflect the Government's concern for energy efficiency and conservation. In the letter that the Secretary of State sent to us this morning, he spelt out several respects in which the Government have developed a very effective approach to the question.
We endorse and accept, for example, the idea of having an independent regulator with a duty to promote the efficient use of energy. We also endorse and accept the fact that the Secretary of State will be required to promote the efficient use of energy. The Secretary of State said in his letter:
The licences for electricity distribution companies will require them to advise their customers on the efficient use of energy.
But what happens if they neglect that advice? That is a question to which I shall return.
The Secretary of State continues:
The Bill introduces competition in electricity generation".
I share his faith that under the new structure competition will be rigorous and effective, but we do not yet know quite how effective it will be. In the context of the greenhouse effect, unless it is completely effective many other things will have to be done to secure the overall objective.
The Secretary of State said in his letter that the Government have made special provision to encourage the development of renewable sources of energy. I welcome

that, but I would argue, as I did the other day, that the scope of renewables is limited. Even with almost zero interest capital investment on the largest scale, we can expect the contribution from that quarter to be comparatively small. I welcome what the Government have done about combined heat and power.
Let us now consider the four specific arguments that my right hon. Friend the Secretary of State advanced in his case for rejecting the amendment. The Secretary of State said in his letter that the amendment
gives a duty to both the Secretary of State and the Director General of Electricity Supply to promote energy efficiency but does not indicate what should happen in the event of disagreement between them, how they should consult, or what should be the basis of evidence necessary to satisfy their duties".
Surely those are not insuperable problems. A formal quarterly report from the director general to my right hon. Friend would certainly cover the question of how they should consult and of what should be the basis of evidence. The degree of observance of standards could also be incorporated in such a report. Conspicuous failures could also be incorporated, as could applications for new and existing generators in areas where, in the director general's opinion, there is massive scope for increased efficiency in energy use or conservation. I am not terribly convinced by my right hon. Friend's first argument, therefore.
My right hon. Friend then argues that the Bill
removes from the Secretary of State the power to fix prices or decide"—
that is the key word—
on new capital investment … it would be quite wrong for electricity prices to be subject to political interference once the industry is in the private sector.
I do not really believe that we are talking about a decision, though. As I understand it, under the new system, the decision to invest in new generating capacity will be made by existing major companies, by new companies moving in to the industry or by the area boards. The decision to invest will be theirs. What we ask—perhaps we are seeking to transfer American experience here—is that the Secretary of State should retain the power to examine and, if necessary, to reject that decision to invest. As far as I have been able to judge the American experience, the fact that that power has been retained by the public utility commissions has occasionally resulted in a restriction of investment, but it has certainly not resulted in the disappearance of investment in electricity generating capacity in the United States, so I am not altogether impressed by that argument either.
My right hon. Friend then refers to the need to balance energy efficiency against the need for security of supply. That judgment is made repeatedly in arguments between public utility commissions—in the various states of the United States where the structure remains—and those seeking to invest. My right hon. Friend referred to the danger of brownouts, but I do not believe the United States has experienced persistent and threatening brownouts during the past two or three decades. That is not the record in the United States, and it would not necessarily happen here.
Finally, my right hon. Friend argues:
the Amendment is illogical since it inhibits the construction of new capacity by the distribution companies".
I found myself unable to understand what my right hon. Friend was driving at there; perhaps he will explain later.
I come now to what I believe to be the key statement underlining the Government's position—the statement made by my noble Friend Baroness Hooper in the other place:
It is in the consumer's own interest to use electricity efficiently."—[Official Report, House of Lords, 16 May 1989; Vol. 507, c. 1053.]
Of course it is in the consumer's interest to use energy efficiently. Against that fact, however, we must consider the evidence given to the Committee in the other place, which I found extraordinarily impressive, that, whereas in 1976 the Commission decided that by 1985 we should have endeavoured to achieve a 20 per cent. improvement in energy efficiency, the perceptible improvement eight years later was a mere 3 per cent.
We have now reached a stage at which the difference between the 3 per cent. that has been attained and is demonstrable and the 20 per cent. or more that the Commission thought desirable—the Toronto conference looked at that figure and even bigger figures—has become much more crucial in the light of our enlarged understanding of the fact that our civilisation relies on massive burning of hydrocarbon fuels and that that contributes to global warming and the greenhouse effect.
We must now go further. However important and significant voluntary contributions may be, and however important market forces may be—I do not for one moment underestimate their importance; as I have said elsewhere, I regard them as a necessary condition of our salvation—we must go further than we have gone so far if we are even to begin to achieve the massive shifts in the patterns of energy consumption that we may be asked to undergo in the next five or 10 years.
If such massive shifts are required, the whole ethos of energy conservation and efficiency will have to be looked at, in my humble judgment, in a much more fundamental sense. That is the priority that has dominated my thinking on the matter for some considerable time.
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I am sure that my right hon. Friend's amendment recognises the problem, as I know that he does from our many formal and informal discussions on the matter. However, I do not believe in my heart of hearts—if I did I would not be standing here—that it contributes significantly to the solution. If I use the word "significantly", that is where I would like the emphasis to lie. I believe it to be anodyne and exhortatory, but I do not believe it to be effective. When hon. Members suggest that this kind of measure produces very little in the way of significant results, I call to mind the experience of California, where we know that the California commission, as a result of measures taken some time ago, managed to achieve savings of $350 million in energy conservation and efficiency. That was the agreed measurement of the Utility Commission.
Bearing in mind the roughly similar scale of the Californian and United Kingdom economies, can my right hon. Friend tell us that we can look forward in the next one, two or three years to energy efficiency savings of the order of $350 million? If we cannot so look forward, why can we not? If we can, why do we not adopt similar measures?
That summarises my position. I shall end with an analogy which this time is completely mine, but is none the less valid. It concerns global warning. We know that some time ago a small capsule known as Challenger exploded on its way into space because of the failure of an O ring. We know that our civilisation is on a somewhat larger capsule in space. We know that the O ring round it is the atmosphere and the ozone layer. When the Challenger exploded, the President of the United States set up an investigatory commission which produced a fine report saying why the O ring had failed and its consequences. If the O ring round this planet fails, there will be no presidential commission; there will be no follow up; there will be no civilisation.

Mr. Malcolm Bruce: I congratulate the Chairman of the Select Committee on Energy for his two forthright and timely reports on the subject. They have given unequivocal guidance which the Government would be foolish not to accept. After all, that guidance was based not just on the opinion of the Committee, but on universal testimony from a wide variety of sources. It was testimony that I would regard as overwhelming and I find it depressing that the Government seek to dismiss it.
I have a special interest in the clause. Like all hon. Members who recognise the importance, especially, of tackling the greenhouse effect, I believe that the clause is our last chance to convert the Bill from what is effectively a commercial interest measure to an environmental Bill. Although the Government have insisted all the way through that that is not what the Bill is about, they should accept even now that that is what the Bill should be about.
The wording of the Lords amendment, which the Secretary of State criticised so fulsomely, does not fail the test that he suggests. I am a little biased because I had a substantial hand in drafting the amendment. It is based partly on an amendment that I moved in Committee, especially the enforcement element of the clause. For the Government to say that there is a technical deficiency in the amendment and, therefore, reject the whole concept is not very convincing, because the Government could modify the amendment to make it work if they wanted to and were prepared to put the political will behind it.
I and my colleagues have tabled an amendment to the Government's own pathetically weak pusillanimous amendment, which seeks to ensure that enforcement is built into the requirement to promote energy efficiency. Pious declarations of good intent are not good enough. As the hon. Member for Havant (Sir I. Lloyd) said, we have had consistent statements from the Department of Energy, through the Energy Efficiency Office, about the objective of achieving 20 per cent. savings per year. That has been recommended for years, but we have not come anywhere near it. Clearly, publicising the benefits of energy efficiency and advertising the fact that it is in the commercial interest of consumers to take account of energy efficiency are not enough. We are dealing, after all, not just with economics, but with the environment of our planet and ecosystem.
I admit, as have other hon. Members, that the amendment is based on American experience, but I do not accept the Secretary of State's rejection of that experience. I have had discussions with people involved in utilities on both sides of the fence in many states in America, and I do not believe that his statistical rebuttal stands up to examination.
I must stress that the amendment is essential to tackling effectively the greenhouse effect. Untrammelled industrial expansion, which is what we have been experiencing throughout the world in the past 20 years, is now bringing our planet to the boil. The Prime Minister's conversion to concern about the greenhouse effect, heralded in her Royal Society speech, is genuine, but I find it incredible that she does not seem able to grasp the fact that it requires a fundamentally different approach to policy.
Independent assessment suggests that, within existing technology, we can achieve a reduction of more than 20 per cent. in carbon dioxide output by the year 2005 while still sustaining a 2·5 per cent. per annum growth. If that information, which comes from a variety of sources, is anything like true, how can any responsible Government fail to take action to ensure that we secure that benefit? If the Government are really pretending that this pathetic amendment, which is their alternative to the Lords amendment, will go anywhere near achieving that, they are treating us with contempt and as fools. I am not prepared to be treated as a fool by the Government or the Secretary of State.
I do not believe that we will achieve anything like progress towards that essential reduction unless we have a much stronger measure. A Bill about the regulatory framework of the electricity industry is the most appropriate one to contain such a measure.
We in the United Kingdom are major contributors to the greenhouse effect. We cannot hide behind the need to secure international action and use that as an excuse for not taking action on our own behalf—yet that, essentially, is what the Government are doing.
As I understand it, in simple terms, carbon dioxide accounts for about 50 per cent. of the greenhouse effect and 80 per cent. of that carbon dioxide comes from burning fossil fuels. Here in the United Kingdom, with 1 per cent. of the world's population, we are contributing 3 per cent. of the carbon dioxide output. We must, therefore, take action to put our own house in order if we are to make any contribution to solving the global problem.
The problem touched on by the Secretary of State is not confined to the United States industry, which has a tendency, as he put it, to go for overcapacity. I represent a constituency in Scotland and I have never been convinced that we need 105 per cent. extra capacity. If that is not excess capacity, I do not know what is. But even taking the United Kingdom position as a whole, the problem with the electricity industry, as it is presently constituted and as it will be constituted post-privatisation, is that its response to increasing electricity demand is to want to build more power stations, when its response should be to use the capacity that we have substantially more efficiently. That makes economic sense, but, more importantly, it makes environmental sense. The economic arguments have not delivered the goods. We need more action to ensure that we achieve more substantial results.
Our commitment to energy conservation goes back a long way. I was involved in writing a pamphlet in the mid-1970s on the important role of conservation and what it can contribute. I find it depressing to look back over the period of that first oil crisis to see the way in which we were then approaching the issue of energy conservation, and to find out how little progress has been made 15 years on, when we now know that the environmental consequences are far greater than we realised then.
We have tabled amendments which are only fall-back amendments. I believe that the House should agree with the Lords amendment and reject the Government's proposed motion to disagree. The Lords amendment sets the framework which ensures that energy efficiency is not only something that we seek to promote or that we express as being desirable, but something by which we can put teeth behind the Director General of Electricity Supply to ensure that energy efficiency is achieved. So far, we have conspicuously failed in that.
The benefits are not just environmental. The benefits of seeking greater efficiency in energy use are that it will help to alleviate fuel poverty and to improve the competitiveness of our industry. In a sense, we get three benefits in one—a benefit to the consumer, a benefit to industry and a benefit to the civilisation of the earth in ensuring the protection of the environment.
When the Secretary of State replies to the debate, it would be helpful if he could say exactly how the Government will confront the crisis of the greenhouse effect if he does not believe that enforcement of energy conservation has a part to play.
I draw attention to two passages in the report of the Select Committee on Energy, entitled "Energy Policy Implications of the Greenhouse Effect". Paragraph 102 states:
the most striking feature of our Enquiry has been the extent to which improvements in energy efficiency—across all sectors of the economy—are almost universally seen as the most obvious and most effective response to the problem of global warming".
That is the Committee's view and it is the view of experts. What is the Government's view? Do the Government agree? If so, what will they do about it? If they do not agree, how do they justify their splendid isolation on that argument? We need to hear answers to those questions.
In paragraph 146 the Committee states:
It would be inexcusable if pusillanimity and the inability of the governments of the world to plan long-term allowed irreversible and disastrous global warming to occur for want of the means or political will to take effective action to curb it.
We and the Lords are proposing a way in which the Government could take effective action. The Government amendment is a way of taking no effective action and of ensuring that the problem will continue and get worse and that the civilisation to which we contribute will continue to be damaged. The Government must accept that their amendment is unacceptable and that it will have to be reversed. If this Government will not do that, a future Government must.
The Secretary of State does not have the time that he thinks. Every scientific report suggests that the problem of global warming is becoming more and more urgent. Having just heard the Secretary of State's remarks, I advise him that it is a grave tragedy if he thinks that he and his party can continue to sit on the Government's green Benches and fail to grasp the nettle that the people of this country expect them to grasp. The sooner that he and his party are removed from office, the better. He has shown a total failure to recognise that representing commercial interests in this place is not what he is here for. As Secretary of State for Energy, he has a wider responsibility. His decision to move the motion to reverse the Lords amendment proves that he has failed in that responsibility. People will not forgive him for doing so.

Mr. Peter Rost: Increasing concern about the threat of global warming is rapidly rising to the top of the world's political agenda. I have attempted to assess the merits of the Government's new clause in that context. I have listened carefully to my right hon. Friend the Secretary of State, but in my view his approach does not offer an adequate response to what may well be the greatest environmental challenge that has so far threatened mankind.
All the best scientific advice tells us that it may be another five years or more before international research studies can guide world politicians about the causes and effects of global warming. So far, all that we are certain about is that global warming is happening and that it is measurable. What we do not know yet is how much of the global warming is caused by mankind's distortion of the natural balance of global ecological systems.
We do not yet know the likely effect on sea levels, world climate, agriculture or anything else. We do not yet know how much global warming can be expected if we succeed internationally in stabilising carbon dioxide releases. We do not even know how much global warming is in the pipeline, resulting from increased CO2 and other gas emissions over recent decades. We do not know how long the lead time will be. We do not know how serious the threat may be if we succeed and begin to implement the Toronto conference proposal of a 20 per cent. world reduction in greenhouse gases by 2005.
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However, what we do know and what we ignore at our peril is the fact that there is global warming. We also know the overwhelming consensus of scientific advice to us here and now. Until we can predict with more precision what may need to be done to save life on earth, all the authoritative voices are saying that in the meantime, as an insurance policy—even if it is a third-party insurance policy, rather than a comprehensive insurance policy—we need vigorously to promote energy efficiency.
Therefore, I urge my right hon. and hon. Friends to study the report of the Select Committee on Energy. It is all there. I believe that it is the most important report that the Committee has produced to the House in its 10 years' existence. It is by no means the first report in which we have recommended a policy of energy efficiency, but it is the most important report. We have gathered the most wide-ranging expert evidence, including from those scientists and energy experts who participated in the No. 10 Downing street seminar. They all came to the same conclusion—that the priority now should be greater energy efficiency because that is the quickest, least costly and least painful option and the one with the most potential.
Judged against that overriding priority, I am afraid that I must advise my right hon. Friend the Secretary of State that the Government's proposal is inadequate. It does not have sanctions and it does not address itself to the priorities. I accept that the Lords amendment has technical flaws and that it might well discourage more efficient investment in power plants, such as combined heat and power even though such new investment would double thermal efficiency and thus make a greater contribution to reducing fuel consumption and pollution than would investing at the consumer end of energy efficiency.
However, I also accept that much of what needs doing cannot be included in this Electricity Bill. The distribution

companies can do a great deal and my right hon. Friend's amendment will direct that beginning. However, until the Government provide much stronger market signals for consumers, it will not happen.
What we need is an energy efficiency Bill to meet the real challenge of global warming just as we are promised a green Bill next year. We need an energy efficiency Bill to build on what my right hon. Friend has done. I welcome his announcement this week about stronger building regulations. Such a Bill would at long last deal with a system of energy labelling—the labelling of buildings and energy appliances—which, through incentives and the fiscal system, would send the right signals to consumers. It would be a programme of incentives with some regulation and with a fiscal carrot and stick.
We know that the potential for energy efficiency could replace the equivalent of 12 new large power stations, so reversing the annual increase in global greenhouse gases, and perhaps meeting the Toronto target of a 20 per cent. reduction. We also know that that would be cost effective because it would have a short pay-back period. It would be less costly than meeting the increasing demand with new capacity.
I understand the Government's reluctance to tie the electricity industry with unreasonable regulations. I accept that argument. On the other hand, the Bill provides tough regulations to promote competition so that we can put downward pressure on electricity prices. That will be done through a tough regulatory system. Should we not also accept equally tough regulations to promote greater energy efficiency in order to put downward pressure on global warming?
If the existing consumer signals—the market forces—are enough to provide greater energy efficiency, why has that not happened, particularly in the public sector where the Government's responsibility lies? An energy bill carrying a cost of nearly £2 billion could achieve a saving of 20 per cent. of taxpayers' money with a pay-back period of two to three years. That has not happened.
We need a wider, all-embracing range of measures, putting energy efficiency higher in the Government's overall priorities. We use the tax system to promote high priority objectives in other sectors of the economy. That is why we provide tax incentives to people to buy their homes. It is not suggested that people would not buy homes if we did not provide them with a tax incentive. But we still provide that encouragement. We use the tax system to provide money for grants for urban renewal, industrial training and regional aids. We use the tax system—the carrot and the stick—to promote lead-free petrol, and I congratulate the Government on having done that. We use the tax system in all sorts of ways to intervene in the market place to provide stronger signals to consumers to do certain things. The time has now come—indeed it is long overdue—for us to do the same with a major programme of energy efficiency incentives.
I hope that my right hon. Friend will have the opportunity to stay on at the Department of Energy and that the Department will stay on for just long enough for him to put such a Bill on the statute book next year. Meanwhile, the Lords amendment has technical defects, so I cannot vote for it. But without a satisfactory Government alternative that meets the spirit of that amendment, I cannot go into the Lobby to vote it out of the Bill either.
I am not brave enough to predict how much time we have to tackle the probable threat of global warming. In due course, we shall know. I just hope that by then it will not be too late.

Mr. Peter Hardy: I hope that the hon. Member for Erewash (Mr. Rost) will not come to regret that he had not the confidence to carry his argument to a more logical conclusion. However, I congratulate him on having argued the case for energy conservation for 10 years.

Mr. Rost: Fifteen.

Mr. Hardy: It has been 10 years since the Government took office and for 10 years he and I and a few other hon. Members have been arguing for energy conservation and energy efficiency and we have become increasingly frustrated that the Government have given priority to the service of greed and the exercise of frivolity.
The Government's exercise of frivolity leads me to my next point, which is that my hon. Friend the Member for Pontefract and Castleford (Mr. Lofthouse) would have spoken today as an active member of the Select Committee with the hon. Members for Erewash and for Havant (Sir I. Lloyd), but he is chairing the Standing Committee on the Football Spectators Bill. He would have made a useful contribution to the debate because the Select Committee offered the House useful advice which I regret that the Government have not taken.
The same applies to the House of Lords Select Committee. Unfortunately, the Government maintain the line that the noble Baroness Hooper, their confident and ebullient spokesman in the other place, adopted in selling the Bill in the other place on Second Reading. The House should pay attention to the words that the noble Baroness Hooper used. In an important presentation of the Government approach she said:
The Bill and public electricity supply licence also provide for the promotion of efficiency in electricity use. These are important provisions which wil be of particular interest to your Lordships. They impose a specific duty on the director and the Secretary of State, and public electricity suppliers will be required to provide guidance to their customers on the efficient use of electricity.
The public electricity supply licences require each licensee to provide, within three months of his licence coming into force, information on the efficient use of electricity. Licensees will be required to revise this information as necessary; and also to send information on energy efficiency prepared by the director to every customer, if so asked."—[Official Report, House of Lords, 25 April 1989; Vol. 506, c. 1155.]
The Government will do all those wonderful things so long as the customer knows that he has the right to ask for the information. We have the hon. Member for Havant who recognised the fragility of our planetary system, and the hon. Member for Erewash who has for 10 years or more served the cause of conservation, but we have a Government who are more interested in a Football Spectators Bill and in serving dogma than in contributing to the survival of the planet.
A few moments ago the hon. Member for Erewash expressed anxiety about whether the Department of Energy would survive. The Secretary of State appeared to be complaining that the Opposition did not have an energy policy. But we would have a Department of Energy because we recognise that an energy policy is vital if we are to manage the affairs of our planet in the hope of creating the prospect of survival within the next few decades.
On Monday 17 July, the House debated the Antarctic Minerals Bill. During that debate I made the point that some of the Antarctic pack ice is scores of thousands of years old. In that ancient pack ice, pockets of air have been trapped since its formation. That air has been measured and the proportion of carbon dioxide in the air in that trapped air is half what it is at present in our planet. In the face of that change, a change which is almost certainly accelerating rapidly, the Government have an obligation to seek to contribute to survival. Therefore, it is a pity that we have seen an utterly counter-productive exercise.
In the next few weeks, I understand that hundreds of cups and saucers bearing the mark of the CEGB, or E, representing the publicly-owned electricity company, will go out of use because the private sector cannot possibly allow publicly-owned and publicly-purchased cups and saucers to bear the brand of the publicly-owned industry. It will go out and buy more.
The Minister knows, and the Select Committee recognised, that enough money was spent last year to employ 222 people and this year 749 people, not to contribute to the survival of the planet, but simply to promote the organisation of electricity privatisation. There has been clear evidence of fecklessness and frivolity. It is regrettable that the Secretary of State, rather than seeking a way to make the minor flaws in the amendment acceptable, should prefer to return to the present grossly unsatisfactory position.

Mr. Michael Stern: As I am conscious of the need for brevity, I shall concentrate my remarks on two of the points made by the hon. Member for Sedgefield (Mr. Blair). He began—I believe that it is a frequent trick of members of his profession—by making a statement with which he said everyone would agree. I certainly do not agree. It was that energy efficiency is the best way to combat global warming. Perhaps the hon. Gentleman believes that, but it is rather like the White Queen asking Alice to believe six impossible things before breakfast.
I remind the hon. Gentleman of my comments on Second Reading, when I said that in more than one third of the world the energy intake available to each person was less than one tenth of the energy intake available in the developed world. In those circumstances, I do not understand how anyone could suggest that energy efficiency is a solution to the problems of the world. A reduction in energy production would inevitably mean condemning one third of the world to continuing grinding poverty. Quite frankly, that would be an expression of inhumanity that I had thought that even the Labour party had abandoned. A policy of energy efficiency to solve the problem of global warming would be at such a cost to humanity that most of us would consider it unacceptable.
The second point in the hon. Gentleman's speech which struck me with some horror was when he criticised the Government's amendment because it did not set targets for energy demand. I hate to have to tell the hon. Gentleman this, but it is not a function of the Bill to set targets for energy demand. Indeed, it is not a function of Government to set such targets. We have, thank goodness, moved beyond the days of rationing when a Government could say to ordinary people and to industry, "You may have so much and no more."
The hon. Gentleman might suggest that the amendment should set targets for energy demands, but not have the power to enforce those targets. I would not trust any Government with having that power and never using it. The hon. Gentleman's criticism of the Government's amendment is, therefore, a criticism of the Bill because it does not take us back down the road, which he clearly would prefer, of a controlled economy. The hon. Gentleman's complaint is that it is not a paving stone on the road to state control. As such, not only do I reject the Opposition's criticism but I earnestly commend the Government's amendment to the House.

Mr. Alex Salmond: I wish briefly to support my two colleagues on the Select Committee who have already contributed to the debate. The Select Committee strongly supported the principles of the Lords amendment. We wanted an obligation placed on the electricity suppliers to promote energy efficiency, with penalties if that obligation was not met. The Select Committee identified tariff control as the most effective means of imposing penalties. In no way could it be said that the Government's amendment is strong enough to meet those requirements. The Select Committee accepted that the Lords amendment was technically deficient, but it asked that the Government's response to it should reflect
its intentions as fully as possible.
The Government's amendment certainly does not do that.
I wish to deal specifically with the Scottish position, and I hope that the Secretary of State will pay particular attention because most of his opening remarks were irrelevant to Scotland. Of course, in any electricity industry there must be a balance between security of supply and conservation. However, Scotland has a technical over-capacity of 100 per cent., a duopoly and an integrated structure. I do not think that there will be any competition in the privatised electricity industry in Scotland. Even the Secretary of State will admit that Scotland will have even less competition than England and Wales. In the circumstances of over-capacity and low or no competition, the privatised companies will have the strongest possible motivation for selling as much electricity as possible. Therefore, the regulator will have to have the strongest possible enforcement powers to ensure that the companies meet their energy efficiency obligations.
The Secretary of State did not deal with the circumstances in Scotland and his silent partner, the Minister with responsibility for electricity in Scotland, is not even speaking in the debate. Who, then, could deny the Select Committee's original advice that the distinctive nature of Scotland's electricity system demanded distinctive regulation if the interests of the Scottish people were properly to be protected? Would the Secretary of State like to intervene on this point?

Mr. Parkinson: No.

Mr. Salmond: I wish that the right hon. Gentleman would intervene. He made no remarks relevant to Scotland in his opening speech, so I hope that he will do so when he replies.
I wish to make a few remarks about the process followed by the Select Committee. There was a difference in emphasis on a number of factors relating to the

greenhouse effect, but eventually all members of the Committee agreed on two points. The first was that action had to be taken to deal with the problem of global warming, which we thought to be a serious environmental challenge. The second was that, from the evidence presented to the Select Committee, it was clear that energy efficiency provided the best, quickest and most substantial means of making an impact on the problem.
The Lords amendment has had at least some success because it has persuaded the Government to think about the matter. I hope that the Select Committee's report on the greenhouse effect will make them think rather further than their glib initial response. Given the strength of evidence put before the Select Committee, and given the strength of opinion voiced in the Committee's two reports, we would be selling ourselves short if we accepted the Government's extremely modest amendment as being in any way adequate to deal with the problems.

Mrs. Teresa Gorman: There is concern that our climate is being substantially altered by an increase in the volume of gases, particularly carbon dioxide, in the atmosphere. However, it should be remembered that at least 99 per cent. of climatic effects are caused not by changes in the atmosphere but by the earth's proximity to the sun and to the effect of sun spots. The contribution made by the atmosphere to climatic changes is relatively minor.
It is also important to remember that the carbon cycle—the release of carbon dioxide into the atmosphere—is not a one-way traffic. Carbon dioxide is reabsorbed by the soil and oceans, and particularly by plants. Plants usually photosynthesise—and I speak as a biologist—at less than 50 per cent. of their capacity, but the earth's capacity to balance the effects of carbon dioxide is rarely discussed.
Whenever the greenhouse effect is debated, one often has to deal with a cascade of uncertain criteria. We should remember that when we start worrying people about melting ice caps submerging in water not only Southend but London and half of the British Isles. Although it is true that more fossil fuel is used today, the rate at which that use is increasing is dropping substantially. It is said by those who warn of a cataclysm that fossil fuel usage increases by about 4 per cent. annually, whereas the figure is now down to only about 2·75 per cent. There is awareness of the problem, and something is being done about it.
When my right hon. Friend the Secretary of State is pressed to make important policy judgments, I urge him to bear in mind the lack of scientific evidence on the true effect of the release of carbon dioxide into the atmosphere. I am not arguing that man's activities have no effect, because they have. If a forest is turned into agricultural land, if a swamp is drained, or if more fossil fuel is burnt, heat and gases are released into the atmosphere. However, I reiterate that the effect is largely self-correcting.
The heat effect is micro-related. Urban areas are heat islands, and their temperatures may vary one or two degrees from that of the surrounding countryside. Nevertheless, that extra heat is quickly dispersed and does not make a significant contribution overall. I urge my right hon. Friend to maintain a balanced view in deciding on future policies until such times that more scientific evidence emerges as to the true nature of the carbon dioxide problem and whether it is already being corrected through our awareness of the potential problem. Even so,


that problem is puny by comparison with the massive effect over the millennia of the earth's proximity to the sun and of the way in which the earth relates to the sun and moves around it.

Mr. David Steel: Having listened to the hon. Member for Billericay (Mrs. Gorman), I am tempted to inquire of the Secretary of State what he intends doing about the proximity of the earth to the sun. I suspect that the Government have no more policy on that than they have on various other matters.
The debate should confine itself to the serious issue raised by their Lordships. While I am quite prepared to bow to the superior scientific knowledge of the hon. Member for Billericay, I believe that most people in this country assent to the simple proposition that we should use no more energy than we need for our normal daily and commercial lives. If we agree on that simple proposition, we must accept also that we are nowhere near to achieving that desirable objective. The debate in the other place, and public reaction to it, demonstrated widespread anxiety that far higher priority should be given to environmental matters.
The Select Committee chaired by the hon. Member for Havant (Sir I. Lloyd) produced a very cogent report, which received far more public attention than most Select Committee reports for the very reason that it struck an intelligent chord on the same theme. Now that the subject of energy efficiency is before us again tonight, we are obliged to ask ourselves what we can do, as mere legislators, to allay public anxiety and to make sure that in restructuring the electricity industry and the sale and distribution of its product we do not ignore the issues that have been raised. The feeble amendment that the Government invite the House to accept pays lip service to energy conservation but does nothing to promote it.
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The purpose of the Bill is to privatise the manufacture and sale of electricity. I do not claim to be an expert economist, but I understand that those engaged in that process are primarily interested in making a profit. That is the purpose of the Bill, which is one of a whole series of Government measures dedicated to the pursuit of making money. One way of making more money is to expand the market in which one is manufacturing and selling. The legislation has an inbuilt impetus to increase energy consumption, so we must ensure that effective control is written into the Bill.
I agree with the hon. Member for Banff and Buchan (Mr. Salmond) that, thanks to the wrong forecasts made by the industry in the 1970s—the hon. Member for Midlothian (Mr. Eadie) will also recall this—on Scotland's future electricity needs, we were sold a pup in having to accept the construction of the Torness power station. The figures were completely bogus. As a consequence, Scotland is littered with mothballed power stations of every conceivable variety. It is not just a question of the Bill encouraging companies to manufacture more electricity but, as was said by the hon. Member for Banff and Buchan, in the case of Scotland, of selling what they are already capable of manufacturing in greater and greater quantities. If nothing is done, that is what will happen. Fortunately, their Lordships have given us a way of doing something by suggesting built-in controls.
The Select Committee commented:

Only part of this considerable potential for energy efficiency will be realised if present circumstances and Government policies in particular remain unchanged.
The wording proposed by the Secretary of State means that Government policies will remain unchanged. The Committee's report added:
Market mechanisms alone will not produce an adequate response.
I do not see the hon. Member for Havant in the vanguard of those wanting a state-controlled economy, as was suggested by the hon. Member for Bristol, North-West (Mr. Stern). Indeed, the hon. Member for Havant is well known in this House for being a market freebooter. Nevertheless, he chaired a Select Committee that undertook a serious investigation of the issues and produced a sensible report. It concluded:
A mixture of regulations, penalties and incentives is required to promote energy efficiency, and the Government should bring these forward.
Suddenly a solution lands on the Government's plate in the form of the amendment from another place. The Government did not even have to invent an answer because one was generously and kindly produced for them by the combined might of the minds in the other place, yet they spurn that proposal.
We must honestly admit that our country has not been very successful at, or interested in, energy conservation. Even if the hon. Member for Billericay is right—which I beg leave to doubt—about the minimal effect on the ozone layer of increased energy consumption, and although I am privileged to live in a part of the country that is relatively pollution-free, I noticed when I visited Northampton last weekend, which has beautiful countryside even if it cannot compare with the Scottish borders, that a brown haze of pollution was visible to the naked eye which came from the industrial towns in that part of the country. One does not need to be a scientist to know that that kind of pollution cannot be healthy.
In earlier years, the Government did a great deal through home insulation grants to help energy conservation. In 1987, however, they were stopped for all but those on supplementary benefit. We are no longer providing people with incentives to ensure that private dwellings are as energy-efficient as they should be; nor do we make much effort in the public sector—we need not go far from this place to see that.
I am a new tenant in the parliamentary annexe of the Norman Shaw North building. As my fellow tenants will know, in the dead of winter the place is boiling hot, and there is no control over the temperature. If anyone complains, a member of our efficient staff will come along and put lagging on the pipes, so that the excessive amount of heat that has been generated can in some way be suppressed and prevented from entering our rooms. If we cannot even get the temperature of this place right, what hope have we of sending a call for energy efficiency across the country?
The Government's replacement for their Lordships' proposals simply gives the regulator a possible responsibility—no more than that—to set standards of energy efficiency. Our amendment seeks to rectify that, and we shall divide on it later this evening. As was mentioned earlier, we have a precedent in British Gas. All that British Gas has done, however, is to produce a rather badly printed leaflet—available in some gas showrooms—giving advice on how to promote energy efficiency. The electricity


industry is desperately in need of more than mere leaflets and advice: its need is much greater than that of the gas industry.
The main failing of the Government's alternative proposal is that, in practice, it would have no teeth. If a supplier fails to comply with the provisions of the Lords amendment, on the other hand, the regulator has two real sanctions, over tariff increases and over permission to construct new plant. I think that those sanctions are essential in the public interest. I know that phrases such as "public interest" and "public service" have rather gone out of fashion in recent years, but I feel that in this context it is time that they became fashionable again.

Mr. Malcolm Moss: As a signatory of the early-day motion to which I am delighted to see that my right hon. Friend the Secretary of State has responded in the amendment, I—along with others—have sought to express my concern about energy efficiency. We expressed that concern for three reasons: we recognised its contribution to mitigating the greenhouse effect, we saw that it kept a downward pressure on electricity prices and, of course, we knew that it prevented unnecessary generating plant from being built and used.
Let us examine the history of the Central Electricity Generating Board, much beloved by Opposition Members—an example of an American vertically integrated monopoly utility. It built new capacity in the past without too much regard to the ultimate cost, and without any regard—as far as I can determine—to energy efficiency. Yet over the years we have heard nothing from Opposition Members about any of those deficiencies in the present system. To listen to them, one would think that the Government had done nothing.
It is time to put the record straight. Britain's rate of improvement in energy efficiency is now twice that of any other EEC country. We were once the seventh largest energy consumer out of 10 countries, and we are now the fourth largest out of 12, although our gross national product has increased by 25 per cent. in the past 15 years. The carbon dioxide generated from each unit of electricity has been cut by 33 per cent. in the past 30 years. In the past 15 years, energy efficiency measures have saved the country 122 million tonnes of coal equivalent. There is no room for complacency, but that is certainly not the record of a Government who are showing a lack of interest or involvement.
The Electricity Bill contains a large number of measures that seek to develop and promote energy efficiency, including the imposition of a duty of promotion on the director general and the Secretary of State, and licences issued to distribution companies will require them to promote energy efficiency. This could mean a whole new range of activities, as the privatised PLCs will be able to become involved in efficiency, manufacture and sale. The companies will want to keep customers' bills down, and will buy from the cheapest generators—those that employ the most energy-efficient measures in their plant. Competition will mean that new technologies—for example, combined-cycle gas—will come on to the market for the first time. At a meeting yesterday, the new chairman of British Gas told us that he was involved in 20 sets of discussions on that new technology, including

discussions with National Power and PowerGen. It is important to remember that gas produces 55 per cent. less carbon dioxide than coal.
The Bill makes special provisions for renewable energy, which produces no carbon dioxide and no pollution. It has been given a market share of some 600 MW. Methane gas contributes 30 times more global heating than carbon dioxide: about 46 land-fill projects produce 41 MW.
Much has been said today about the American model—vertically integrated monopolies whose price increases are strongly regulated. The problem is that we have moved away from vertical integration: we now have a privatised industry on the stocks, and have separated generation and supply. In America, because prices are built into a formula based on the return on assets, there is always pressure on the utility to build new plant and increase the asset base—hence the need to introduce the corrective regulatory system called least-cost planning.
Least-cost planning, as set out in the Lords amendment, would drive a coach and horses through the negotiations in the free market between suppliers and generators. That is unworkable, as the proposers have admitted. The Government's amendment is much more sensible.

Mr. Rhodri Morgan: We have all had to apply the principles of energy conservation to the length of our speeches. That is particularly difficult for politicians from my part of the world, but I shall do my best to limit my remarks so that we can complete the debate on the original timetable.
That does not mean that this is not an important issue; it is among the most important issues of the current Parliament, and was recognised as such by the Prime Minister when she signed a declaration last Sunday, along with the other six leaders of the Group of Seven advanced industrialised nations. She said that from now on environmental matters would rank equally with economic matters, even at so-called economic summits of the Group of Seven. That illustrates the importance of putting the environment on the agenda: those, at any rate, were the Prime Minister's words.
We do not want to pass any legislation that does not accord with the spirit of that declaration—which the Prime Minister signed in all sincerity, as did her fellow signatories. This is the first opportunity that hon. Members on both sides of the House have had to try to put it into effect, and we should all be conscious of that when we decide how to vote.
As I intend to pass up the opportunity of commenting on hon. Members' speeches in the traditional way, I shall not deal with the rate of improvement in energy efficiency mentioned by the hon. Member for Cambridgeshire, North-East (Mr. Moss) or with the interesting idea of the hon. Member for Billericay (Mrs. Gorman) about carbon replacement therapy for the globe. I shall, however, refer to the statesmanlike speech of the hon. Member for Havant (Sir I. Lloyd), the Chairman of the Select Committee. I hope as many of the uncommitted as possible will give it serious thought, and will recognise that if a statesmanlike, experienced Chairman of the Energy Select Committee can regard the issue as important enough for him to criticise the Government's attitude, it bears thinking about on the Back Benches. What the hon. Gentleman was really saying was that when we have all left this place our descendants will ask us, "What did you do


in the great war against energy, waste and inefficiency, Daddy?". The hon. Gentleman gave a strong signal that we should all follow.
It is not just a matter of reading early-day motions. That is just the graffiti of the Houses of Parliament. What really counts is which Lobby we choose. When one compares the Government amendment, which is long on bumf and short on statute, with the Lords amendment, which tries to do something about a problem and which is generally recognised as capable of offering a major contribution to the solution of global warming, making better use of financial resources and entering into the spirit of the G7 summit declaration last Sunday, the way in which we should bend our thoughts is clear.
7 pm
Sometimes we reject Lords amendments because we feel that the Lords are talking for the landed interest, but in Lords amendment No. 3 they are talking for the whole country and for what people outside want. With the full authority of my right hon. Friend the Leader of the Opposition, I offer an electoral pact to all Conservative Members who signed that early-day motion. If they join us in the Lobby tonight, we will write a letter to the Green party asking its members not to stand against them at the next election. I cannot do better than that. Do we want it said of us, when we consider energy efficiency and conservation, that we accepted the Government's pathetic attempt to replace the Lords amendment, when the Government's sole contribution to energy conservation is to cut down more forests to produce more junk mail, more leaflets, more bumf, more switch-off-something campaigns and more full-page advertisements?
We should remember the Prime Minister's words to the Royal Society when she said that we only have a lease on this planet and we must hand it on to our children in at least as good a state as it was when we took it over. All Conservative Members who are thinking seriously about these issues and about their place in history and not about their relations with their Whips' Office will follow us into the Lobby tonight.

Mr. Parkinson: With the leave of the House, I thank my hon. Friend the Member for Cambridgeshire, North-East (Mr. Moss) for pointing out that, although a number of hon. Members making speeches tonight gave the impression that they had suddently discovered energy efficiency for the first time, over a period of years, as a result of persistent campaigns, Britain has achieved a first-class record of improved performance in the use of energy. My hon. Friend quoted a mass of statistics which I shall not repeat, but they demonstrated that, although Opposition Members have discovered energy efficiency for the first time, British people have been saving energy consistently and well for a long time.
America has been quoted to us as an example, presumably because of its amazing policies, as a country which we should aspire to emulate. Let me point out a few facts. In energy consumption per head, Americans use almost twice as much as we do; in electricity consumption per head they use considerably more than twice the amount we do; in energy consumption per unit of GDP they use nearly twice as much as we do and their emissions of carbon dioxide per head are almost twice as much as ours. The country which we are all being urged to emulate and which, presumably, is on to a lot of secrets to which

we have denied ourselves access performs about half as well by any criteria of energy efficiency one cares to name. We had a look at the state of Maine in which the hon. Member for Sedgefield (Mr. Blair) has suddenly developed an enormous interest. It has had least-cost planning. so presumably we should see the benefit, but its consumption of electricity is growing faster than ours. I can say only that by their work shall ye know them, and the results of access to the amazing policies which have gripped the imagination of Opposition Members, and some members of the Select Committee, appear not to be showing good results and to be leaving America very near the bottom of any energy efficiency league table that one would care to mention, in stark contrast with Britain.
The hon. Member for Sedgefield talked about 29 states in America. Even the arch-fanatic, Mr. Andrew Warren, has been able to identify only 10 out of 52 states., and admitted that only three of them are states with any remote competition built into their systems. The hon. Member for Sedgefield and the right hon. Member for Tweedale, Ettrick and Lauderdale (Mr. Steel) mentioned the fact that the word "may" was used. That is a statutory drafting practice where one does not specify in the statute itself exactly the terms which the person has to follow. "May" will be "will". The director general takes this duty extremely seriously, but he has to consult in drawing up the code of practice and performance. He will do that, he will implement it and he will have sanctions.
My hon. Friend the Member for Havant (Sir I. Lloyd) quoted with admiration California, pointed out that it has roughly similar energy consumption to ours, and said that it had saved $350 million a year. Our estimate so far is that our Energy Efficiency Office has helped to produce a saving of £500 million. He also quoted the fourth argument I used in my letter:
The Amendment is illogical since it inhibits the construction of new capacity by the distribution companies.
He said that he did not understand what that meant. Perhaps had he read the second half of the sentence:
yet it is the generating companies who will be building the lion's share of the new capacity
it would have become clear to him that to impose a duty on the electricity suppliers—as the Lords amendment does—to inhibit their ability to build new capacity, when the new capacity will be built by the generators not covered by the Lords amendment, makes an enormous hole in the argument which he put forward.
My hon. Friend the Member for Havant was kind enough to say that the Bill contained a considerable number of powers, but he forgot to mention the effect of the new clause and the new licence conditions, which were also ignored by the hon. Member for Sedgefield. The new licence conditions combined with the new clause will give the director general the power to set standards for promoting energy efficiency, and to enforce them; and of course he has available to him the sanctions that anyone in his position would have. If the licence conditions are ignored, he has economic sanctions, he can go to court and get an injunction and he can force the supply companies to honour the code which he sets for them. That is an important sanction. The idea that the public electricity suppliers will behave with ill faith and ignore their legal obligations and that the director general will have no power to do anything about them is quite wrong.

Mr. Blair: The Secretary of State well knows that I asked what the standards would consist of. I asked him a


specific question and perhaps he will now answer it. Will the regulator be able to require public electricity suppliers to provide incentives for consumers to use energy more efficiently?

Mr. Parkinson: The reason for the "may" is that the director general, after consultation, will draw up codes of practice which will set performance standards. After consultation, bearing in mind the duty that Parliament has placed on him, the prime duty to promote energy efficiency——

Mr. Jimmy Dunnachie: Answer the question.

Mr. Parkinson: I am answering the question, but the hon. Gentleman has not listened to any of the debate and would not recognise a correct answer if I gave one, as I am.
The Bill contains a power and a duty and the revised licence condition defines how that duty will be carried out. The director general will set performance standards and enforce them and he can penalise companies that do not implement them.
The new clause considerably strengthens the energy provisions in the Bill, and I hope that my hon. Friends will remember that, although we have had a wonderful day of bad-mouthing our country, we have a very good record of energy efficiency. Although Opposition Members have come late to it, we have been pursuing it in a very determined way for a long time, and the new clause will continue that good work effectively.

Mr. James Wallace: rose——

Madam Deputy Speaker (Miss Betty Boothroyd): Mr. Wallace.

Mr. Frank Haynes: On a point of order, Madam Deputy Speaker. The hon. Member for Orkney and Shetland (Mr. Wallace) has not been present for the whole of the debate. May I put it to you that it is not fair that at this stage he should be called to make a speech? We have had a contribution from the Liberal Bench.

Madam Deputy Speaker: The hon. Member for Orkney and Shetland (Mr. Wallace) is a Member of the House and I called him to speak.

Mr. Wallace: What I have to say will probably not occupy much more than the time it took the hon. Member for Ashfield (Mr. Haynes) to make that point of order.
The Secretary of State said that his proposed new clause would strengthen the Bill. That is nonsense. It may represent a strengthening of the measure as it went to the other place, but it has returned from there as an adequate piece of legislation which will have teeth. Our amendment No. (iii) is designed to give teeth to the toothless proposal that the Government have made.

Mr. Salmond: rose——

Mr. Wallace: I give way to the hon. Gentleman.

Mr. Stern: On a point of order, Madam Deputy Speaker. If the hon. Member for Orkney and Shetland (Mr. Wallace) had been here to listen to the debate, he

would know that the comments that he is now making have been made at least five times. Does he really have to waste the time of the House?

Madam Deputy Speaker: Order. I repeat, the hon. Member for Orkney and Shetland is a Member of the House. When he rises, he is entitled to be called.

Mr. Salmond: Did the hon. Member for Orkney and Shetland (Mr. Wallace) notice that the Secretary of State's reply was as silent on the Scottish issues which he was specifically asked to address as the Minister of State, Scottish Office has been silent virtually throughout the debates on this legislation?

Mr. Wallace: Although I may not have been present for the whole of the debate, I had the misfortune to hear the speech of the hon. Member for Bristol, North-West (Mr. Stern). I also heard the valid questions that the hon. Member for Banff and Buchan (Mr. Salmond) addressed to the Secretary of State but to which he did not get a reply. That is why we shall divide the House on our amendment No. (iii).

Question put, That this House doth disagree with the Lords in the said amendment:—

The House divided: Ayes 310, Noes 216.

Division No. 312]
[7.09 pm


AYES


Adley, Robert
Butterfill, John


Alexander, Richard
Carlisle, John, (Luton N)


Alison, Rt Hon Michael
Carlisle, Kenneth (Lincoln)


Allason, Rupert
Carrington, Matthew


Amess, David
Carttiss, Michael


Amos, Alan
Cash, William


Arbuthnot, James
Chalker, Rt Hon Mrs Lynda


Arnold, Jacques (Gravesham)
Chapman, Sydney


Arnold, Tom (Hazel Grove)
Chope, Christopher


Ashby, David
Churchill, Mr


Aspinwall, Jack
Clark, Dr Michael (Rochford)


Atkins, Robert
Clark, Sir W. (Croydon S)


Atkinson, David
Clarke, Rt Hon K. (Rushcliffe)


Baker, Rt Hon K. (Mole Valley)
Colvin, Michael


Baker, Nicholas (Dorset N)
Conway, Derek


Baldry, Tony
Coombs, Simon (Swindon)


Banks, Robert (Harrogate)
Cope, Rt Hon John


Batiste, Spencer
Cormack, Patrick


Bellingham, Henry
Couchman, James


Bendall, Vivian
Cran, James


Bennett, Nicholas (Pembroke)
Currie, Mrs Edwina


Bevan, David Gilroy
Curry, David


Blackburn, Dr John G.
Davies, Q. (Stamf'd &amp; Spald'g)


Blaker, Rt Hon Sir Peter
Davis, David (Boothferry)


Body, Sir Richard
Devlin, Tim


Bonsor, Sir Nicholas
Dorrell, Stephen


Boscawen, Hon Robert
Douglas-Hamilton, Lord James


Boswell, Tim
Dover, Den


Bottomley, Mrs Virginia
Dunn, Bob


Bowden, A (Brighton K'pto'n)
Durant, Tony


Bowden, Gerald (Dulwich)
Dykes, Hugh


Bowis, John
Eggar, Tim


Boyson, Rt Hon Dr Sir Rhodes
Evans, David (Welwyn Hatf'd)


Braine, Rt Hon Sir Bernard
Evennett, David


Brandon-Bravo, Martin
Fairbairn, Sir Nicholas


Brazier, Julian
Fallon, Michael


Bright, Graham
Farr, Sir John


Brooke, Rt Hon Peter
Favell, Tony


Brown, Michael (Brigg &amp; Cl't's)
Field, Barry (Isle of Wight)


Browne, John (Winchester)
Finsberg, Sir Geoffrey


Bruce, Ian (Dorset South)
Fishburn, John Dudley


Buchanan-Smith, Rt Hon Alick
Fookes, Dame Janet


Buck, Sir Antony
Forman, Nigel


Budgen, Nicholas
Forsyth, Michael (Stirling)


Burns, Simon
Forth, Eric


Burt, Alistair
Fowler, Rt Hon Norman


Butcher, John
Fox, Sir Marcus






Franks, Cecil
McLoughlin, Patrick


Freeman, Roger
McNair-Wilson, Sir Michael


French, Douglas
McNair-Wilson, Sir Patrick


Galbraith, Sam
Major, Rt Hon John


Gardiner, George
Malins, Humfrey


Garel-Jones, Tristan
Mans, Keith


Gill, Christopher
Maples, John


Glyn, Dr Alan
Marland, Paul


Goodhart, Sir Philip
Marlow, Tony


Goodlad, Alastair
Marshall, John (Hendon S)


Goodson-Wickes, Dr Charles
Marshall, Michael (Arundel)


Gorman, Mrs Teresa
Martin, David (Portsmouth S)


Gorst, John
Mates, Michael


Gow, Ian
Maude, Hon Francis


Greenway, Harry (Ealing N)
Mawhinney, Dr Brian


Greenway, John (Ryedale)
Maxwell-Hyslop, Robin


Gregory, Conal
Mayhew, Rt Hon Sir Patrick


Griffiths, Sir Eldon (Bury St E')
Meyer, Sir Anthony


Griffiths, Peter (Portsmouth N)
Miller, Sir Hal


Ground, Patrick
Miscampbell, Norman


Gummer, Rt Hon John Selwyn
Mitchell, Andrew (Gedling)


Hague, William
Mitchell, Sir David


Hamilton, Neil (Tatton)
Monro, Sir Hector


Hampson, Dr Keith
Montgomery, Sir Fergus


Hanley, Jeremy
Moore, Rt Hon John


Hannam, John
Morrison, Sir Charles


Hargreaves, A. (B'ham H'll Gr')
Morrison, Rt Hon P (Chester)


Hargreaves, Ken (Hyndburn)
Moss, Malcolm


Harris, David
Moynihan, Hon Colin


Hawkins, Christopher
Mudd, David


Hayes, Jerry
Needham, Richard


Hayward, Robert
Nelson, Anthony


Heathcoat-Amory, David
Neubert, Michael


Hicks, Mrs Maureen (Wolv' NE)
Newton, Rt Hon Tony


Higgins, Rt Hon Terence L.
Nicholls, Patrick


Hill, James
Nicholson, Emma (Devon West)


Hind, Kenneth
Norris, Steve


Hogg, Hon Douglas (Gr'th'm)
Onslow, Rt Hon Cranley


Holt, Richard
Oppenheim, Phillip


Howard, Michael
Page, Richard


Howarth, Alan (Strat'd-on-A)
Parkinson, Rt Hon Cecil


Howarth, G. (Cannock &amp; B'wd)
Patnick, Irvine


Howe, Rt Hon Sir Geoffrey
Patten, Rt Hon Chris (Bath)


Howell, Rt Hon David (G'dford)
Patten, John (Oxford W)


Howell, Ralph (North Norfolk)
Pattie, Rt Hon Sir Geoffrey


Hughes, Robert G. (Harrow W)
Pawsey, James


Hunt, David (Wirral W)
Peacock, Mrs Elizabeth


Hunt, Sir John (Ravensbourne)
Porter, Barry (Wirral S)


Hunter, Andrew
Porter, David (Waveney)


Irvine, Michael
Portillo, Michael


Irving, Charles
Powell, William (Corby)


Jack, Michael
Price, Sir David


Jackson, Robert
Raffan, Keith


Jessel, Toby
Raison, Rt Hon Timothy


Johnson Smith, Sir Geoffrey
Rathbone, Tim


Jones, Gwilym (Cardiff N)
Redwood, John


Jones, Robert B (Herts W)
Renton, Tim


Jopling, Rt Hon Michael
Rhodes James, Robert


Kellett-Bowman, Dame Elaine
Riddick, Graham


Key, Robert
Ridley, Rt Hon Nicholas


King, Roger (B'ham N'thfield)
Ridsdale, Sir Julian


Kirkhope, Timothy
Roe, Mrs Marion


Knapman, Roger
Rossi, Sir Hugh


Knight, Greg (Derby North)
Rowe, Andrew


Knowles, Michael
Rumbold, Mrs Angela


Lamont, Rt Hon Norman
Ryder, Richard


Lang, Ian
Sainsbury, Hon Tim


Latham, Michael
Sayeed, Jonathan


Lawrence, Ivan
Scott, Rt Hon Nicholas


Lawson, Rt Hon Nigel
Shaw, David (Dover) 


Leigh, Edward (Gainsbor'gh)
Shaw, Sir Giles (Pudsey)


Lennox-Boyd, Hon Mark
Shaw, Sir Michael (Scarb')


Lester, Jim (Broxtowe)
Shephard, Mrs G. (Norfolk SW)


Lightbown, David
Shepherd, Colin (Hereford)


Lilley, Peter
Skeet, Sir Trevor


Lloyd, Peter (Fareham)
Smith, Sir Dudley (Warwick)


Lord, Michael
Smith, Tim (Beaconsfield)


Lyell, Sir Nicholas
Speed, Keith


McCrindle, Robert
Spicer, Sir Jim (Dorset W)


MacKay, Andrew (E Berkshire)
Spicer, Michael (S Worcs)





Stanbrook, Ivor
Waddington, Rt Hon David


Stanley, Rt Hon Sir John
Wakeham, Rt Hon John


Steen, Anthony
Walden, George


Stern, Michael
Walker, Bill (T'side North)


Stevens, Lewis
Walker, Rt Hon P. (W'cester)


Stewart, Allan (Eastwood)
Waller, Gary


Stewart, Andy (Sherwood)
Walters, Sir Dennis


Stokes, Sir John
Ward, John


Stradling Thomas, Sir John
Wardle, Charles (Bexhill)


Sumberg, David
Warren, Kenneth


Summerson, Hugo
Watts, John


Tapsell, Sir Peter
Wells, Bowen


Taylor, Ian (Esher)
Wheeler, John


Taylor, John M (Solihull)
Whitney, Ray


Taylor, Teddy (S'end E)
Widdecombe, Ann


Tebbit, Rt Hon Norman
Wiggin, Jerry


Temple-Morris, Peter
Wilkinson, John


Thatcher, Rt Hon Margaret
Wilshire, David


Thompson, D. (Calder Valley)
Winterton, Mrs Ann


Thompson, Patrick (Norwich N)
Winterton, Nicholas


Thorne, Neil
Wolfson, Mark


Thurnham, Peter
Wood, Timothy


Townend, John (Bridlington)
Woodcock, Dr. Mike


Townsend, Cyril D. (B'heath)
Yeo, Tim


Tracey, Richard
Young, Sir George (Acton)


Trippier, David



Trotter, Neville
Tellers for the Ayes:


Twinn, Dr Ian
Mr. Tom Sackville and Mr. David Maclean.


Vaughan, Sir Gerard



Viggers, Peter





NOES


Abbott, Ms Diane
Cousins, Jim


Adams, Allen (Paisley N)
Cox, Tom


Allen, Graham
Crowther, Stan


Alton, David
Cryer, Bob


Anderson, Donald
Cummings, John


Archer, Rt Hon Peter
Cunliffe, Lawrence


Armstrong, Hilary
Cunningham, Dr John


Ashdown, Rt Hon Paddy
Dalyell, Tam


Ashley, Rt Hon Jack
Darling, Alistair


Ashton, Joe
Davies, Rt Hon Denzil (Llanelli)


Banks, Tony (Newham NW)
Davies, Ron (Caerphilly)


Barnes, Harry (Derbyshire NE)
Davis, Terry (B'ham Hodge H'l)


Barnes, Mrs Rosie (Greenwich)
Dewar, Donald


Barron, Kevin
Dixon, Don


Beckett, Margaret
Dobson, Frank


Beith, A. J.
Doran, Frank


Bell, Stuart
Duffy, A. E. P.


Benn, Rt Hon Tony
Dunnachie, Jimmy


Bennett, A. F. (D'nt'n &amp; R'dish)
Dunwoody, Hon Mrs Gwyneth


Bermingham, Gerald
Eadie, Alexander


Bidwell, Sydney
Fatchett, Derek


Blair, Tony
Field, Frank (Birkenhead)


Blunkett, David
Fields, Terry (L'pool B G'n)


Boateng, Paul
Fisher, Mark


Boyes, Roland
Flannery, Martin


Bray, Dr Jeremy
Flynn, Paul


Brown, Gordon (D'mline E)
Foot, Rt Hon Michael


Brown, Nicholas (Newcastle E)
Foster, Derek


Bruce, Malcolm (Gordon)
Fraser, John


Buckley, George J.
Fyfe, Maria


Caborn, Richard
Galbraith, Sam


Callaghan, Jim
Galloway, George


Campbell, Menzies (Fife NE)
Garrett, John (Norwich South)


Campbell, Ron (Blyth Valley)
Garrett, Ted (Wallsend)


Campbell-Savours, D. N.
George, Bruce


Canavan, Dennis
Gilbert, Rt Hon Dr John


Carlile, Alex (Mont'g)
Godman, Dr Norman A.


Cartwright, John
Golding, Mrs Llin


Clark, Dr David (S Shields)
Gorman, Mrs Teresa


Clarke, Tom (Monklands W)
Gould, Bryan


Clelland, David
Graham, Thomas


Clwyd, Mrs Ann
Grant, Bernie (Tottenham)


Cohen, Harry
Griffiths, Win (Bridgend)


Coleman, Donald
Grocott, Bruce


Cook, Frank (Stockton N)
Hardy, Peter


Cook, Robin (Livingston)
Harman, Ms Harriet


Corbett, Robin
Hattersley, Rt Hon Roy


Corbyn, Jeremy
Healey, Rt Hon Denis






Heffer, Eric S.
McKay, Allen (Barnsley West)


Hinchliffe, David
McKelvey, William


Hoey, Ms Kate (Vauxhall)
Maclennan, Robert


Hogg, N. (C'nauld &amp; Kilsyth)
McNamara, Kevin


Home Robertson, John
McWilliam, John


Hood, Jimmy
Madden, Max


Howarth, George (Knowsley N)
Mahon, Mrs Alice


Howell, Rt Hon D. (S'heath)
Marek, Dr John


Howells, Geraint
Marshall, David (Shettleston)


Hoyle, Doug
Marshall, Jim (Leicester S)


Hughes, John (Coventry NE)
Martin, Michael J. (Springburn)


Hughes, Robert (Aberdeen N)
Martlew, Eric


Hughes, Roy (Newport E)
Maxton, John


Hughes, Simon (Southwark)
Meacher, Michael


Illsley, Eric
Meale, Alan


Ingram, Adam
Michael, Alun


Janner, Greville
Michie, Bill (Sheffield Heeley)


Johnston, Sir Russell
Michie, Mrs Ray (Arg'l &amp; Bute)


Jones, Martyn (Clwyd S W)
Moonie, Dr Lewis


Kennedy, Charles
Morgan, Rhodri


Kinnock, Rt Hon Neil
Morley, Elliot


Kirkwood, Archy
Morris, Rt Hon A. (W'shawe)


Lambie, David
Morris, Rt Hon J. (Aberavon)


Lamond, James
Mowlam, Marjorie


Lewis, Terry
Mullin, Chris


Litherland, Robert
Nellist, Dave


Livingstone, Ken
Oakes, Rt Hon Gordon


Livsey, Richard
O'Brien, William


Lloyd, Tony (Stretford)
O'Neill, Martin


Lofthouse, Geoffrey
Orme, Rt Hon Stanley


McAllion, John
Parry, Robert


McAvoy, Thomas
Patchett, Terry


Macdonald, Calum A.
Pendry, Tom

`( 1) The Director may, after consultation with public electricity suppliers and with persons or bodies appearing to him to be representative of persons likely to be affected, from time to time—
(a) determine such standards of performance in connection with the promotion of the efficient use of electricity by consumers as, in his opinion, ought to be achieved by such suppliers; and
(b) arrange for the publication, in such form and in such manner as he considers appropriate, of the standards so determined.

(2) Different standards may be determined under this section for different public electricity suppliers.'

Read a Second time.

Amendment (iii) proposed to the amendment proposed in lieu of the Lords amendment disagreed to, in line 11, at end insert
'and
(c) shall set a date by which these standards must be achieved and shall apply such sanctions as appears necessary should these standards not be met.'.—[Mr. Wallace.]

Question put, That the proposed amendment be made to the amendment proposed in lieu:—

The House divided: Ayes 135, Noes 298.

Division No. 313]
[7.26 pm


AYES


Abbott, Ms Diane
Bray, Dr Jeremy


Allen, Graham
Brown, Gordon (D'mline E)


Alton, David
Brown, Nicholas (Newcastle E)


Anderson, Donald
Bruce, Malcolm (Gordon)


Armstrong, Hilary
Caborn, Richard


Ashdown, Rt Hon Paddy
Callaghan, Jim


Ashton, Joe
Campbell, Menzies (Fife NE)


Banks, Tony (Newham NW)
Campbell, Ron (Blyth Valley)


Barnes, Harry (Derbyshire NE)
Campbell-Savours, D. N.


Barnes, Mrs Rosie (Greenwich)
Carlile, Alex (Mont'g)


Barron, Kevin
Cartwright, John


Beckett, Margaret
Clark, Dr David (S Shields)


Beith, A. J.
Clelland, David


Bermingham, Gerald
Clwyd, Mrs Ann


Blair, Tony
Cohen, Harry


Blunkett, David
Coleman, Donald


Boateng, Paul
Cook, Frank (Stockton N)


Boyes, Roland
Cook, Robin (Livingston)





Pike, Peter L.
Spearing, Nigel


Powell, Ray (Ogmore)
Steel, Rt Hon David


Prescott, John
Steinberg, Gerry


Primarolo, Dawn
Stott, Roger


Quin, Ms Joyce
Straw, Jack


Radice, Giles
Taylor, Mrs Ann (Dewsbury)


Randall, Stuart
Thompson, Jack (Wansbeck)


Redmond, Martin
Turner, Dennis


Rees, Rt Hon Merlyn
Vaz, Keith


Richardson, Jo
Wall, Pat


Roberts, Allan (Bootle)
Wallace, James


Robertson, George
Walley, Joan


Robinson, Geoffrey
Warden, Gareth (Gower)


Rogers, Allan
Wareing, Robert N.


Rooker, Jeff
Watson, Mike (Glasgow, C)


Rowlands, Ted
Welsh, Andrew (Angus E)


Ruddock, Joan
Welsh, Michael (Doncaster N)


Salmond, Alex
Williams, Rt Hon Alan


Sedgemore, Brian
Williams, Alan W. (Carm'then)


Sheldon, Rt Hon Robert
Wilson, Brian


Shore, Rt Hon Peter
Winnick, David


Short, Clare
Wise, Mrs Audrey


Skinner, Dennis
Worthington, Tony


Smith, Andrew (Oxford E)
Wray, Jimmy


Smith, C. (Isl'ton &amp; F'bury)
Young, David (Bolton SE)


Smith, Rt Hon J. (Monk'ds E)



Smith, J. P. (Vale of Glam)
Tellers for the Noes:


Snape, Peter
Mr. Nigel Griffiths and Mr. Frank Haynes.


Soley, Clive





Corbett, Robin
Hughes, Simon (Southwark)


Corbyn, Jeremy
Illsley, Eric


Cousins, Jim
Johnston, Sir Russell


Cryer, Bob
Jones, Barry (Alyn &amp; Deeside)


Cummings, John
Jones, Martyn (Clwyd S W)


Cunliffe, Lawrence
Kennedy, Charles


Davies, Ron (Caerphilly)
Lamond, James


Davis, Terry (B'ham Hodge H'l)
Livingstone, Ken


Dewar, Donald
Livsey, Richard


Dixon, Don
Lloyd, Tony (Stretford)


Dobson, Frank
McAvoy, Thomas


Doran, Frank
Macdonald, Calum A.


Eadie, Alexander
Maclennan, Robert


Fatchett, Derek
McNamara, Kevin


Field, Frank (Birkenhead)
McWilliam, John


Fisher, Mark
Madden, Max


Foot, Rt Hon Michael
Mahon, Mrs Alice


Foster, Derek
Marshall, David (Shettleston)


Garrett, Ted (Wallsend)
Martin, Michael J. (Springburn)


George, Bruce
Maxton, John


Godman, Dr Norman A.
Meale, Alan


Golding, Mrs Llin
Michael, Alun


Gordon, Mildred
Michie, Bill (Sheffield Heeley)


Griffiths, Nigel (Edinburgh S)
Michie, Mrs Ray (Arg'l &amp; Bute)


Griffiths, Win (Bridgend)
Moonie, Dr Lewis


Hardy, Peter
Morgan, Rhodri


Hattersley, Rt Hon Roy
Morley, Elliot


Haynes, Frank
Morris, Rt Hon A. (W'shawe)


Hoey, Ms Kate (Vauxhall)
Mowlam, Marjorie


Hogg, N. (C'nauld &amp; Kilsyth)
Mullin, Chris


Home Robertson, John
Nellist, Dave


Hood, Jimmy
Patchett, Terry


Howells, Geraint
Pike, Peter L.


Hoyle, Doug
Quin, Ms Joyce


Hughes, Robert (Aberdeen N)
Randall, Stuart






Richardson, Jo
Straw, Jack


Roberts, Allan (Bootle)
Thompson, Jack (Wansbeck)


Robertson, George
Vaz, Keith


Robinson, Geoffrey
Wall, Pat


Rogers, Allan
Walley, Joan


Rowlands, Ted
Wardell, Gareth (Gower)


Salmond, Alex
Wareing, Robert N.


Sedgemore, Brian
Welsh, Andrew (Angus E)


Shore, Rt Hon Peter
Williams, Rt Hon Alan


Skinner, Dennis
Williams, Alan W. (Carm'then)


Smith, Andrew (Oxford E)
Winnick, David


Smith, C. (Isl'ton &amp; F'bury]
Wise, Mrs Audrey


Smith, Rt Hon J. (Monk'ds E)



Smith, J. P. (Vale of Glam)
Tellers for the Ayes:


Soley, Clive
Mr. Archy Kirkwood and Mr. James Wallace.


Spearing, Nigel



Steel, Rt Hon David





NOES


Adley, Robert
Cran, James


Alexander, Richard
Currie, Mrs Edwina


Alison, Rt Hon Michael
Curry, David


Allason, Rupert
Davies, Q. (Stamf'd &amp; Spald'g)


Amess, David
Davis, David (Boothferry)


Amos, Alan
Day, Stephen


Arbuthnot, James
Devlin, Tim


Arnold, Jacques (Gravesham)
Dorrell, Stephen


Arnold, Tom (Hazel Grove)
Douglas-Hamilton, Lord James


Ashby, David
Dover, Den


Atkinson, David
Dunn, Bob


Baker, Rt Hon K. (Mole Valley)
Dykes, Hugh


Baker, Nicholas (Dorset N)
Eggar, Tim


Baldry, Tony
Evans, David (Welwyn Hatf'd)


Banks, Robert (Harrogate)
Evennett, David


Batiste, Spencer
Fairbairn, Sir Nicholas


Bellingham, Henry
Fallon, Michael


Bendall, Vivian
Farr, Sir John


Bennett, Nicholas (Pembroke)
Favell, Tony


Bevan, David Gilroy
Field, Barry (Isle of Wight)


Blackburn, Dr John G.
Finsberg, Sir Geoffrey


Blaker, Rt Hon Sir Peter
Fishburn, John Dudley


Bonsor, Sir Nicholas
Fookes, Dame Janet


Boscawen, Hon Robert
Forman, Nigel


Boswell, Tim
Forsyth, Michael (Stirling)


Bottomley, Mrs Virginia
Forth, Eric


Bowden, A (Brighton K'pto'n)
Fowler, Rt Hon Norman


Bowden, Gerald (Dulwich)
Fox, Sir Marcus


Bowis, John
Franks, Cecil


Boyson, Rt Hon Dr Sir Rhodes
Freeman, Roger


Braine, Rt Hon Sir Bernard
French, Douglas


Brandon-Bravo, Martin
Gale, Roger


Brazier, Julian
Garel-Jones, Tristan


Bright, Graham
Gill, Christopher


Brown, Michael (Brigg &amp; Cl't's)
Glyn, Dr Alan


Browne, John (Winchester)
Goodhart, Sir Philip


Bruce, Ian (Dorset South)
Goodlad, Alastair


Buck, Sir Antony
Goodson-Wickes, Dr Charles


Budgen, Nicholas
Gorman, Mrs Teresa


Burns, Simon
Gorst, John


Burt, Alistair
Gow, Ian


Butcher, John
Green way, Harry (Ealing N)


Butterfill, John
Greenway, John (Ryedale)


Carlisle, John, (Luton N)
Gregory, Conal


Carlisle, Kenneth (Lincoln)
Griffiths. Sir Eldon (Bury St E')


Carrington, Matthew
Griffiths, Peter (Portsmouth N)


Carttiss, Michael
Ground, Patrick


Cash, William
Gummer, Rt Hon John Selwyn


Chalker, Rt Hon Mrs Lynda
Hague, William


Chapman, Sydney
Hamilton, Neil (Tatton)


Chope, Christopher
Hampson, Dr Keith


Churchill, Mr
Hanley, Jeremy


Clark, Dr Michael (Rochford)
Hannam, John


Clark, Sir W. (Croydon S)
Hargreaves, A. (B'ham H'll Gr')


Clarke, Rt Hon K. (Rushcliffe)
Hargreaves, Ken (Hyndburn)


Colvin, Michael
Harris, David


Conway, Derek
Hawkins, Christopher


Coombs, Simon (Swindon)
Hayes, Jerry


Cope, Rt Hon John
Hayhoe, Rt Hon Sir Barney


Cormack, Patrick
Hayward, Robert


Couchman, James
Heathcoat-Amory, David





Hicks, Mrs Maureen (Wolv' NE)
Nicholson, Emma (Devon West)


Higgins, Rt Hon Terence L.
Norris, Steve


Hill, James
Onslow, Rt Hon Cranley


Hind, Kenneth
Oppenheim, Phillip


Hogg, Hon Douglas (Gr'th'm)
Page, Richard


Holt, Richard
Parkinson, Rt Hon Cecil


Howard, Michael
Patnick, Irvine


Howarth, Alan (Strat'd-on-A)
Patten, Rt Hon Chris (Bath)


Howarth, G. (Cannock &amp; B'wd)
Patten, John (Oxford W)


Howell, Rt Hon David (G'dford)
Pattie, Rt Hon Sir Geoffrey


Howell, Ralph (North Norfolk)
Pawsey, James


Hughes, Robert G. (Harrow W)
Peacock, Mrs Elizabeth


Hunt, David (Wirral W)
Porter, David (Waveney)


Hunt, Sir John (Ravensbourne)
Portillo, Michael


Hunter, Andrew
Powell, William (Corby)


Irvine, Michael
Price, Sir David


Irving, Charles
Raffan, Keith


Jack, Michael
Raison, Rt Hon Timothy


Jackson, Robert
Rathbone, Tim


Jessel, Toby
Redwood, John


Johnson Smith, Sir Geoffrey
Renton, Tim


Jones, Gwilym (Cardiff N)
Rhodes James, Robert


Jones, Robert B (Herts W)
Riddick, Graham


Jopling, Rt Hon Michael
Ridsdale, Sir Julian


Kellett-Bowman, Dame Elaine
Roe, Mrs Marion


Key, Robert
Rossi, Sir Hugh


King, Roger (B'ham N'thfield)
Rowe, Andrew


Kirkhope, Timothy
Rumbold, Mrs Angela


Knapman, Roger
Ryder, Richard


Knight, Greg (Derby North)
Sackville, Hon Tom


Knowles, Michael
Sayeed, Jonathan


Lamont, Rt Hon Norman
Scott, Rt Hon Nicholas


Lang, Ian
Shaw, David (Dover)


Latham, Michael
Shaw, Sir Giles (Pudsey)


Lawrence, Ivan
Shaw, Sir Michael (Scarb')


Lawson, Rt Hon Nigel
Shephard, Mrs G. (Norfolk SW)


Lee, John (Pendle)
Shepherd, Colin (Hereford)


Leigh, Edward (Gainsbor'gh)
Skeet, Sir Trevor


Lennox-Boyd, Hon Mark
Smith, Sir Dudley (Warwick)


Lester, Jim (Broxtowe)
Smith, Tim (Beaconsfield)


Lightbown, David
Speed, Keith


Lilley, Peter
Spicer, Sir Jim (Dorset W)


Lloyd, Peter (Fareham)
Spicer, Michael (S Worcs)


Lord, Michael
Squire, Robin


Lyell, Sir Nicholas
Stanbrook, Ivor


Macfarlane, Sir Neil
Stanley, Rt Hon Sir John


MacKay, Andrew (E Berkshire)
Steen, Anthony


McLoughlin, Patrick
Stern, Michael


McNair-Wilson, Sir Michael
Stevens, Lewis


McNair-Wilson, Sir Patrick
Stewart, Allan (Eastwood)


Major, Rt Hon John
Stewart, Andy (Sherwood)


Malins, Humfrey
Stokes, Sir John


Mans, Keith
Stradling Thomas, Sir John


Maples, John
Sumberg, David


Marland, Paul
Summerson, Hugo


Marlow, Tony
Tapsell, Sir Peter


Marshall, John (Hendon S)
Taylor, Ian (Esher)


Marshall, Michael (Arundel)
Taylor, John M (Solihull)


Martin, David (Portsmouth S)
Taylor, Teddy (S'end E)


Mates, Michael
Tebbit, Rt Hon Norman


Maude, Hon Francis
Temple-Morris, Peter


Mawhinney, Dr Brian
Thompson, D. (Calder Valley)


Maxwell-Hyslop, Robin
Thompson, Patrick (Norwich N)


Mayhew, Rt Hon Sir Patrick
Thorne, Neil


Meyer, Sir Anthony
Thurnham, Peter


Miscampbell, Norman
Townsend, Cyril D. (B'heath)


Mitchell, Andrew (Gedling)
Tracey, Richard


Mitchell, Sir David
Trippier, David


Monro, Sir Hector
Trotter, Neville


Montgomery, Sir Fergus
Twinn, Dr Ian


Moore, Rt Hon John
Vaughan, Sir Gerard


Morrison, Sir Charles
Viggers, Peter


Morrison, Rt Hon P (Chester)
Waddington, Rt Hon David


Moss, Malcolm
Wakeham, Rt Hon John


Moynihan, Hon Colin
Walden, George


Mudd, David
Walker, Bill (T'side North)


Needham, Richard
Waller, Gary


Neubert, Michael
Walters, Sir Dennis


Newton, Rt Hon Tony
Ward, John


Nicholls, Patrick
Wardle, Charles (Bexhill)






Warren, Kenneth
Winterton, Nicholas


Watts, John
Wolfson, Mark


Wells, Bowen
Wood, Timothy


Wheeler, John
Woodcock, Dr. Mike


Whitney, Ray
Yeo, Tim


Widdecombe, Ann
Young, Sir George (Acton)


Wiggin, Jerry



Wilkinson, John
Tellers for the Noes:


Wilshire, David
Mr. Tony Durant and Mr. David Maclean.


Winterton, Mrs Ann

Amendment proposed to the Bill in lieu of Lords amendment No. 3 disagreed to, amendment (a), to insert new clause—Promotion of efficient use of electricity—

Amendment accordingly negatived.

Amendment proposed in lieu of the Lords amendment agreed to.

Amendments made to the Bill in lieu of Lords amendment No. 3 disagreed to: (b), in page 32, line 4, leave out 'and'.

(c), in page 32, line 6, at end insert
`and
(c) the levels of performance achieved by such suppliers in connection with the promotion of the efficient use of electricity by consumers.'.

(d), in page 32, line 14, after '39', insert
`or (Promotion of efficient use of electricity)'.

(e), in page 32, line 15, leave out `overall'.—[Mr. Michael Spicer.]

Clause 2

CONSUMERS' COMMITTEES

Lords amendment: No. 2, in page 2, line 22, leave out subsection (4).

Mr. Wallace: I beg to move, as an amendment to the Lords amendment, amendment (a) in line 1, at end add
`and insert
(4) In appointing a person to be a member of a consumers committee the Director shall have regard to the desirability of appointing a person who has knowledge of the geographical make up of the area.'.

Madam Deputy Speaker: With this it will be convenient to take Lords amendments Nos. 100 and 62 to 64.
Lords amendment No. 65, after clause 50, insert the following new clause—National Consumers' Consultative Committee—
.—(1) There shall be a committee, to be known as the National Consumers' Consultative Committee, of which the Director shall be chairman and the ordinary members shall be the persons who for the time being hold office as chairmen of consumers' committees.
(2) The Committee shall meet at least four times a year and shall be under a duty—
(a) to keep under review matters affecting the interests of consumers of electricity generally; and
(b) to facilitate the exchange of information relating to such matters between the Director, the ordinary members and their respective consumers' committees."

Amendment (a) to the proposed Lords amendment, at end add—
`and
(c) to make a report available to the public at least once a year on matters affecting the interests of consumers generally.'.

Mr. Wallace: The Under-Secretary of State may recall that we had a similar debate on Report on an amendment tabled by the hon. Member for Rother Valley (Mr. Barron) to provide for a geographical link between membership of a consumers' committee and the area in which the committee served. I do not deny that I make this point very much from a Highlands and Islands viewpoint, but I am sure that it has similar consequences in other

parts of the country. Issues will arise in a particular geographical area that can best be reflected by people with a knowledge of that area.
The cost of connecting new consumers to the electricity supply has caused considerable controversy in the north of Scotland. The Bill states that the cost of supply will be reasonable in the circumstances. I should welcome the Minister's assurance that the circumstances refer to the consumer as well as to the supplier.
People would certainly not be satisfied if large sums were charged, but it would be more satisfactory if their views were represented on the consumers' committee by people from their area rather than by people from other areas. It is theoretically possible under the Bill for a person from Carlisle who has never set foot in the Highlands and Islands and has no concept of the problems of consumers to represent that area on the committee.
I do not intend to elaborate the point. It is straightforward and very much in the consumers' interest. I cannot see how it compromises what the Government are trying to do in privatising electricity. However, it would mean that the interests of consumers were more likely to be represented by those who knew what those interests were.

Mr. Simon Hughes: It may be helpful for me to add an equally short point from a different geographical perspective. A matter that concerns me, and is a regular concern of hon. Members who represent inner cities, is the way in which our fuel industries and the cost of them affect those on the lowest incomes. A quarter of my constituents are pensioners, and the problem of fuel poverty is illustrated most graphically by a simple comparative statistic. In general terms, for people in the middle classes and middle income brackets, fuel bills are on average 5 per cent. or less of their domestic outgoings. For those in the lowest socio-economic groups and those in the bottom 20 per cent. of income groups, the fuel bill is sometimes as high as one quarter of the regular household budget. The Minister will know that the figure is sometimes one fifth, but often rises up to one quarter.
The group made up of pensioners and the poorest in our society needs to be well represented round the table at which consumers' needs and the implementation of supply systems and programmes that affect consumers' needs and the cost of supply will be determined. I must say to the Minister with some strength that I am aware that his Department has regularly monitored the way in which the cost of fuel bites on those who are least able to afford it simply because they have the lowest household income for everything, including fuel. I am aware that the Department knows and agrees that the statistics are often as I have specified and that fuel can use up a substantial part of those household budgets.
In those circumstances, will the Minister give me and those of us who represent areas where there are many on low incomes and many pensioners, including those living alone, some reassurance that the voice of those people will be well and truly represented on the consumers' committees?

Mr. Thomas McAvoy: The Opposition welcome the Government's decision to accept the Lords amendment and I want to spend a couple of minutes outlining the reasons for that. In Committee, we took the view strongly that information is power and that it is essential that there is as wide a spread of information


as possible to ensure that the system brought forward by the Government for monitoring the electricity industry is accountable not only to local people, but, more widely, to allow full accountability and scrutiny.
The Government originally outlined a regional set-up which meant that there was no link-up for information to be shared throughout the country and for knowledge to be used to put pressure on the system for the benefit of the consumer. The intention behind the amendments and the reason for our support for them is to ensure that matters that affect the interests of electricity consumers generally, including the important issue of prices, are kept under review at a national level in a formal structure. That would ensure a forum for discussion and the exchange of information relating to national policy for electricity consumers. In Committee, we maintained strongly that the Government's proposals were not enough and that there should be some improvements. We welcome the proposals in the amendments which will ensure that there is a national forum to scrutinise what is happening in the electricity industry.
I always shudder when I quote an hon. Member from a Committee Hansard because I think that in future another hon. Member may do the same to me. However, I will take that risk, so here goes. I will quote from a series of debates in which we were putting forward the point that the Government's proposals were not enough. I take some delight at this stage in quoting some of the Minister's comments. He said:
The hon. Member for Gordon claimed that our proposals would not allow for comparison or variation of performance between different areas and regions.
That is, of course, the purpose of the amendment. He continued:
That is highly unlikely for two reasons. Clause 46(2)(d) provides a statutory duty under which the director general must publish in his annual report 'a general survey of the activities during that year of the consumers' committees'. That applies to all consumers' committees throughout the country. On that basis, people will have the means by which they can compare the advice and activities of the different consumers' committees. That is clearly stated as an obligation in the Bill.
The Minister was saying then that the status quo was fine, yet he is now prepared to accept an amendment that puts forward a principle that he rejected in Committee.
7.45 pm
He also said:
It is right that the Bill allows for independent reports to be made more often than annually and on a regional basis. It is also proper that the reporting structure should be encompassed within the new regulatory regime of which the committees will he part. That is the radical new step which I think that hon. Gentlemen will understand if they reflect on it later outside the rhetoric of party confrontation. If they do not, they should have a word with the area councils in their constituencies. The councils are over the moon about the new teeth that we are giving to consumer representatives—[Interruption.] I am not exaggerating.
His rhetoric was part of party confrontation and he automatically rejected the Labour amendment. That rhetoric has now been shown to be misplaced and he has accepted the principle that he was attacking then. However, his rhetoric carried him away in Committee. About major improvements for consumers he said:
We have given them teeth and made them part of the regulatory body. On that basis, we unashamedly ask Opposition Members to withdraw their amendment. If they do not, we shall triumphantly vote against it."—[Official Report, Standing Committee E, 16 February 1989; c. 1033–34.]

We welcome unashamedly the conversion of the Government to our point of view and triumphantly we will not vote against the proposal.

Mr. Malcolm Bruce: I want to speak briefly to amendment (a) to Lords amendment No. 2 which relates to the annual report. It is a matter that we debated fully in Committee, but as the amendment has been selected, it is an appropriate point at which to say to the Minister that the arguments we put in Committee, which the Labour party supported, about the desirability of having an annual report lead me to say that such a provision should be in the Bill. I hope that the Minister will tell us, if he is not prepared to accept the amendment, what assurances he can give.
The hon. Members for Rother Valley (Mr. Barron) and for Cardiff, West (Mr. Morgan) said in Committee that over the years much useful information had been contained within the annual reports from consumer bodies. Without an annual report, it is felt that one cannot monitor from year to year how effectively consumer interests are being protected. The objectives may not be set out and the success in meeting objectives may not be recorded from year to year. It remains my view and, I suspect, the view of Labour Members that annual reports are desirable. It is a matter of regret that the Bill does not require them.
I would be delighted if the Minister were to accept the amendment. If he does not, I hope that he will tell us what measures he is likely to take to ensure that, in general, annual reports will be the norm rather than the exception.

The Parliamentary Under-Secretary of State for Energy (Mr. Michael Spicer): I begin by speaking to the Lords amendments, which I ask the House to accept. They deal with a variety of aspects of the new regional consumer committees which will be set up under clause 2 and which will be a key component of the radically new consumer protection arrangements in the Bill. They will be the director general's eyes and ears. For the first time a set of statutory powers and duties will equip the committees with a formidable set of teeth to deal with consumers' concerns. The Government's basic proposals have been widely welcomed by existing consumer bodies.
The amendments address aspects of the committees' make-up and functions in ways which the Government believe will materially improve their effectiveness. There has not been a fundamental change in the Government's policy, as the hon. Member for Glasgow, Rutherglen (Mr. McAvoy) implied. These are strengthening amendments. We have listened to what was said in Committee, in the House and in the other place and we have introduced improving amendments which do not go against the concepts that we advanced earlier.
Amendment No. 2 removes the criterion which the director general was required to take into account when appointing members of the consumers' committee. That will increase his flexibility when making appointments to the committee and will help to ensure that the best people are appointed, from whatever background. In answer to the hon. Members for Orkney and Shetland (Mr. Wallace) and for Southwark and Bermondsey (Mr. Hughes), may I say that we are not specifying particular groups, whether on a regional basis or on the basis that they represent poor people or pensioners. They made a good point. It is right that the director general should consider such groups, but


appointments will be at his discretion. That is right. Above all, he should look for ability. As the committees will be structured regionally, they will have a regional dimension.
In answer to the hon. Member for Rutherglen, may I say that I have never said that meetings of such groups were a bad thing. The Government have never suggested that. We are against reinstituting a completely independent national body such as the electricity consumers council. It is proposed in amendments Nos. 62, 63 and 65 that there should be a national consumers' consultative committee chaired by the director general and composed of the chairmen of the regional consumers' committees. The director general will include in his annual report a general survey of NCCC activities. That, incidentally, partly answers the question about annual reporting raised by the hon. Member for Gordon (Mr. Bruce).
The committee will meet at least four times a year. It will keep under review matters affecting the interests of consumers of electricity and facilitate the exchange of information between the director general and the consumers' committees. It will be a good forum for the chairmen of the committees to compare notes and for the director general to compare the standards of the committees. We welcome that and I propose that we accept the Lords amendments. The effect will not be the same as setting up a completely independent and different consumers' body, like the present one.

Mr. Simon Hughes: I sat on the Committee of the Bill to create London Regional Transport in which we had a similar debate about consumers' interests. At the end of the day some concessions were made to include a representative, for example, of the disabled, and undertakings were given that certain matters would be for the director general to consider. Will the Minister go further and say that people representing groups suffering from fuel poverty, whether on a geographic or demographic basis, will be specifically represented?

Mr. Spicer: The director general designate will look carefully at what the hon. Gentleman and other hon. Members say about the interests that should be represented on the committee. I am sure that he will take these exchanges seriously when assessing who should be represented. That is different from a statutory requirement to include certain groups. The problem with designating specific interest groups, whether regional, poor people or others, is that one can think of many types of groups. It is completely open-ended. We want an effective group to represent consumers and that can best be done by the director general appointing the members in conjunction with the chairmen.

Mr. Hughes: Will the Minister make it clear that it is his view that the issue of fuel poverty must be properly addressed by the representatives chosen by the director general? That is important because it affects the most vulnerable group of consumers. If the Minister can say that, it will confirm the importance of this exchange.

Mr. Spicer: I do not want to say anything from the Dispatch Box which gives the impression that the Government are leaning on the director general. Personally, I believe that it is a good idea to accommodate the interests of poor people within the new structure. That

is why we have taken so much trouble to introduce licensing conditions on prepayment metering systems and why so much effort has been devoted to the licences. Clearly the interests of poor people will be borne in mind by the director general and in the licensing conditions for prepayment meters. The statutory position is clear. This is a discretionary, not a statutory, power. I am sure that the director will listen carefully to these and other exchanges.
The hon. Member for Gordon wants an annual reporting system. Amendment No. 63 already places a duty on the Director General of Electricity Supply, who will chair the NCCC, to include in his annual report a general survey of its activities during the year. That is in addition to his existing duty to include a general survey of the activities during the year of the regional consumers' committees in his annual report, which will be published. We fully understand the purpose of amendment No. 65(a), but its spirit is accommodated within our amendments and in the Bill.

Mr. Malcolm Bruce: I hear what the Minister says, but he will recall the debate that we had in Committee, when we said that it was not entirely satisfactory that the director was effectively determining what he put in his report rather than putting in what the consumer committee wanted to be said. Will the Minister at least give an assurance that he will monitor the situation if there is any evidence that the consumers' committees are dissatisfied, and that the Government will review the matter if the feeling is that the consumer interest will not be adequately reported?

Mr. Spicer: I can speak with authority only to what is in the Bill. I can say authoritatively that we have taken on board many of the arguments made to us in Committee, and that there will be an annual publishing requirement on the various committees and the National Consumers' Consultative Committee as well. The hon. Gentleman has made this good point fairly, but it has been accommodated within the Bill. It would be worthless for me to go further because we are speaking to a future Act of Parliament, and, however many protestations or exhortations I make, that is what will determine what happens. The Bill meets the hon. Gentleman's objection, and I hope that on that basis he will not press his amendment to a vote. However, I urge the House to agree to the Lords amendments.

Question, That the amendment to the Lords amendment be made, put and negatived.

Lords amendment No. 2 agreed to.

Lords amendments Nos. 100 and 62 to 65 agreed to.

Clause 3

GENERAL DUTIES OF SECRETARY OF STATE AND DIRECTOR

Lords amendment: No. 6, in page 3, line 24, at end insert—
(bb) to promote research into, and the development and use of, new techniques by or on behalf of persons authorised by a licence to generate, transmit or supply electricity;

8 pm

Motion made, and Question proposed, That this House doth agree with the Lords in the said amendment. [Mr. Michael Spicer.]

Madam Deputy Speaker: With this it will be convenient to take Lords amendment No. 90, to insert the following new clause——

PROMOTION OF NEW TECHNIQUES IN NATIONAL INTEREST

".—(1) The Secretary of State shall exercise the power conferred on him by section 5 of the Science and Technology Act 1965 (expenditure on research and development in science or technology) for the purpose of promoting such research into, and such development of, new techniques relating to the generation, transmission or supply of electricity as appears to him to be necessary in the national interest.

(2)The Secretary of State may, if he considers it expedient for purposes connected with the performance of his duty under this section, serve notice under this subsection on any licence holder or any person who is authorised by an exemption to generate or supply electricity.

(3)A notice under subsection (2) above may require the person on whom it is served to furnish, at a time and place specified in the notice, to the Secretary of State such information about that person's business as may be so specified.

(4)Subsections (3), (5) and (7) to (9) of section 94 above shall apply for the purposes of this section as they apply for the purposes of that section."

Amendment (a), in line 15, leave out `(3)'.

Mr. Malcolm Bruce: As the Minister will realise, the purpose of the amendment is to delete subsection (3) of Lords amendment No. 90. It is an attempt to get some clarification from the Minister about what the other place had in mind when it required the person on whom the notice is served
to furnish, at a time and place specified in the notice, to the Secretary of State such information about that person's business as may be so specified.
The Minister will understand that, to somebody with my background, that is a rather sweeping statement, which gives ill-defined powers to require information, for no clear purpose. To put it in a more populist expression, the purpose of my probing amendment is to assert the importance of freedom of information.
What information will be sought? Should it not be more clearly defined? What assurances do we have that the notices will not lead to the seeking of information that is not necessary or relevant? There could be an unwarranted interference because the person in question may not wish to disclose the information and may not feel it necessary or relevant. There could be an unwarranted interference because the person in question may not wish to disclose the information and may not feel it necessary to disclose it, but he might be penalised if he does not. This is an attempt to clarify the position. If the Government accept all of the new clause, what does subsection (3) mean? Would not the clause be better without it?

Mr. Michael Spicer: Amendments Nos. 6 and 90 concern a subject that was discussed at length in Committee—research and development and the impact that the Bill will have on it. The effect of Lords amendment No. 6 is to require the director general and the Secretary of State to take research and development into account when exercising their functions under part I. The essence of the new clause in Lords amendment No. 90, which implements recommendations expressed in another place, is to be found in subsection (1), which places a duty on the Secretary of State to use his powers to support research and development under the Science and Technology Act 1965, for the purpose of promoting research and development of new techniques relating to the generation, transmission or supply of electricity as it appears to him to be necessary in the national interest.
After privatisation, the electricity industry may focus on near market and operational research and development. The practical significance of the new clause will be limited to long-term research and development. That is the first answer to the point put by the hon. Member for Gordon (Mr. Bruce) about how open ended all this is. It will require the Secretary of State to fill in any gaps that he feels should be filled in in the national interest. In order to discharge this duty, the Secretary of State will need to know what the industry is doing, so subsections (2) and (3) provide a reserve information-gathering power to enable the Secretary of State to get information from electricity licensees, or those exempted from the need to have a licence, about their relevant research and development programmes. Subsection (4) deals with the confidentiality of the information so provided and enforcement.
The answer to the hon. Member for Gordon is that there has to be a specific reason why the information should be gathered. That reason is where the Secretary of State believes that there might be a gap affecting the national interest in research and development in the privatised companies, and where he may therefore wish to take decisions that might involve future Government funding. The Government would not be able to collect information without cause and would, if necessary, have to prove what the cause was. That cause is specified, and there is a confidentiality subsection attached to the information-gathering process.
Hon. Members on both sides of the House have said that they are worried about this aspect of long-term research, and the Government are meeting that concern in this way. I hope that I have given the hon. Member for Gordon the assurances that he is seeking and that he will not press what he has already described as a probing amendment. I also hope that he will support the reasons behind the powers that the Government are giving themselves.

Mr. Malcolm Bruce: This part of the clause is less felicitously worded than some of the amendments and new clauses that I have tabled which could have improved the Bill. Therefore, I am surprised by the readiness with which the Minister is prepared to accept the clause, which is woolly, ill defined and sweeping. I accept his assurances, but, as he said earlier, the final authority is the legislation that we are passing. I am uneasy that we are giving the


Secretary of State power to secure quite a lot of information that, at least in theory, could be detrimental to the company concerned—in other words, it could be commercial information.
I note what the Minister said about the confidentiality arrangements. On that basis, I shall let my remarks rest and I hope that I shall never have to refer to them again. I hope that practice does not prove that companies will be asked to divulge information in a way that is not in their interest and is not justified, and that the Secretary of State will not interfere in an unwarranted manner.

Mr. Kevin Barron: I do not share the optimism of the hon. Member for Gordon (Mr. Bruce) about what the Minister has said about Lords amendment No. 6 and the introduction, at long last in the history of this Bill, of a clause that mentions research and development in this industry or industries. I do not share his optimism that mounds of information will be collected, because the obligation that the clause imposes is only that, in the Minister's words, the director general and the Secretary of State must take account of research and development. I am not sure whether taking such considerations into account will result in a lot of gathering of information about these matters.
The official Opposition are at least pleased that in the other place the Government decided to amend the Bill to promote research and development. It is a great pity that on Second Reading, in Committee and on Report the Government chose not to accept new clause 7 which went into detail on how research and development could be protected on behalf of the nation for many years to come. In Committee, the Minister told us that it was not necessary to write in a commitment to research and development because the need to provide a secure supply would be pressure enough on the privatised industry. Other similar unsupported assertions were made. I am glad that the Minister has now at least admitted that near-market considerations are more likely to be taken into account by the generators and others in the industry than the long-term research and development interest for which we argued.
In the same debate the Minister said that the industry should not have to provide information on environmental matters. That was another matter that was to be left completely to regulation. Yet, at this late stage, environmental considerations are being brought into play. Of course they are not the considerations for which my hon. Friends and I argued in the earlier stages of the Bill's passage but the Government are nevertheless admitting at long last that the purely ideological flotation that they planned many months ago is not practicable. The Bill's inadequacies would inevitably have meant that if such matters as research and development were left to the market, Britain's consumers would not have been afforded the protection that they need.
In moving the amendment in the other place, the Parliamentary Under-Secretary of State said:
The new clause will ensure in an explicit and unambiguous way that after privatisation there will be a clearly defined long-stop responsibility for ensuring that R and D which is essential in the national interest is carried out. It will do that by providing statutory underpinning to the present informal arrangements by which National Power and Power Gen, the two main successor power generating companies, will continue to co-operate with ACORD so

that the latter can advise the Secretary of State whether there are any research and development gaps which it is essential that he should fill in the national interest. It would then require the Secretary of State to fill those gaps if it appeared to him that they should be filled in the national interest".—[Official Report, House of Lords, 5 July 1989; Vol. 509, c. 123–34.]
Does the Under-Secretary agree with what was said in the other place; can he give us an unequivocal yes to that statement? If he does agree, we must go on to ask him—given that we are now dealing with the matter in this place—why we ended up with a provision which, it appears to observers, is unlikely to give us the commitment to R and D that was advocated in the other place.
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It is always interesting to hear this Government acknowledge that the private sector may not meet the needs of the nation and concede that Governments have to intervene from time to time. We must also note, however, that the Government's record in setting priorities and advancing the development of new design and technology in the energy sector has been dismal. They may recognise that the nation's interests must be looked after, but nothing that they have done in the past 10 years proves that they recognise what those needs are.
Let me digress for a moment. I happened to read the report of questions to the Chancellor of the Duchy of Lancaster in yesterday's Hansard. In answer to a question directly related to civil research and development in industry, the Parliamentary Under-Secretary of State for Industry and Consumer Affairs said, I assume speaking on behalf of the Government:
We believe, and continue to believe that by having a low tax regime and an environment in which companies can be profitable, we leave the decision on how to invest in their hands, rather than confiscating money from companies through taxation and imposing our decisions on them about how they should invest. That surely makes sense in a vigorous, capitalist economy."—[Official Report, 19 July 1989; Vol. 157, c. 335]
That may make sense to the Under-Secretary of State for Industry and Consumer Affairs, but it does not seem to make sense to Ministers in the Department of Energy who have introduced safeguards, however poor, in relation to investment in research and development in the energy sector.
The Government have not been able to get the balance quite right and the reason is only too clear. Parliamentary experts have recently commented in detail on research and development in the sectors covered by the Department of Energy. We need only look at the last two reports of the Select Committee on Energy to see that research and development has fallen by the wayside, and has not been promoted by the Secretary of State as the amendment suggests it should. That means that the national interest has not been served as the other place so rightly said it should be.
The Select Committee's latest report on the greenhouse effect contains an indictment of the way in which the Department has allocated its research budget. Given the urgency of the problem, it is remarkable that the Department's research budget is actually to fall in the near future. Let us compare the sums allocated to research and development by the Department of Energy in the next 12 months, because those figures will affect environmental matters, too. We find that a meagre £2·6 million is to be spent on coal research while a massive £208 million is to be allocated to nuclear research and development. That money is being given to research and development in an


industry which everyone. including the Secretary of State for Energy, agrees will not produce more electricity until the end of this century, perhaps well beyond. Moreover, when there is a change of Government, there is likely to be a reduction in the amount that the industry produces. Here we are committing millions of pounds to research and development in an industry which at best will remain static for decades to come and a meagre sum to an industry whose effect on our country is massive.
Is that really setting the priorities of the national interest, given that we use four times more coal than nuclear power in electricity generation and will continue to do so for a very long time to come, if for no other reason than that using coal to generate electricity is about 40 per cent. cheaper than using nuclear power? If the amendment is to mean anything, there must be a realignment of the Department's priorities in relation to the national interest, and of the actions of the Secretary of State for Energy and the director general if the privatisation of our electricity supply goes ahead.
It seems remarkable that we should have such a lack of investment in the right places given that the Secretary of State said in his evidence to the Select Committee:
the country cannot afford to turn its back on its largest indigenous source of fuel".
Should he not now be saying that we will promote technologies for the clean burning of coal? We have seen clearly that that cannot be left to the private sector. PowerGen, a CEGB successor company, has a stake in the future of coal burn, but the Secretary of State is saying at this stage that it may contribute only £750,000 to the continuation of the Grimethorpe project for clean coal burning. If that is the first indication of the new generators acting in the national interest, we have a long way to go before we can protect the interests of the nation and the environment in years to come.
Nevertheless, we are still hoping for a positive response from the Government for the continuation of the work on the topping cycle at Grimethorpe. The Government's lack of response to the Select Committee's initial recommendation has prompted an even stronger recommendation in its latest report. I see that my hon. Friend the Member for Barnsley, Central (Mr. Illsley), who sits on that Committee, is present in the Chamber. In the latest report, the Committee said:
This unique technology may be the only acceptable way forward for coal-fired power production. The Government has a responsibility to help bring it to fruition, and we recommend that it should ensure that the next stage of work at Grimethorpe is completed.
For months we have been waiting for a decision on the granting of a sum of no more than £10 million, which would be spread over three years, but yesterday, when the Government saw the poll tax coming on the horizon for April 1990, they were prepared to come to the House and satisfy the revolt of their Back Benchers with an offer of £100 million. However, they manifestly failed to cure the problem. We saw the early arrival of the Secretary of State for the Environment at Downing street this morning, which was no doubt to discuss where he is likely to be sitting when we return from the summer recess.

Mr. Morgan: That explains, perhaps, the difference between R and D, research and development, and B and C, bribery and corruption.

Mr. Barron: I cannot comment on that. My hon. Friend may be able to get into the debate and expand on that a little later. I do not know whether I should tempt him to do that, but it would be interesting.
We have a classical situation where for months and months a world-leading area for clean coal burn is waiting for a paltry sum, but the Government are willing to offer large sums when they are trying to keep the peace in the House.
It is clear that in the national interests we should have a final agreement in relation to the topping cycle at the Grimethorpe plant, so that that technology can be developed. Whether it goes into the public or private sector does not matter, it will be a saleable technology and one that will be acceptable to the environment not just in this country but throughout the world.
We should also be taking steps to ensure that the generating companies will retrofit their coal-fired power stations. How can the Minister expect the private generating companies to respond to demands for cleaning up their coal-fired stations through the fitting of FGD when the Government are preventing them from negotiating contracts of more than five years for the electricity that they produce? I understand that that is a hot potato at the present time in the contract working party and elsewhere. The generators are under instruction to clean up the emissions from coal-fired power stations—that was an instruction from Ministers well before we began discussing the Electricity Bill in this place—but, because of the short termism of the contract between the generators and the supply companies, the generators are saying that they cannot enter into those investment programmes to clean up the emissions. I hope that the Minister will give us his observations on what will happen to the retrofitting of FGD at coal-fired power stations and whether the Government are able to do anything about that. Is it not the case that, by threatening the progress in cleaning up the environment in which we all live, we are seeing a neglect of the national interest?
Does it not make nonsense of the assertions made by Ministers in relation to research and development, when we know that the private sector will respond to the short-term interest of its shareholders, not the long-term interests of the nation? I believe the Minister referred to it as the near-market consideration. The Government should step in to ensure that the work is done—by doing it themselves or by sending others to do it. If this technology can be developed and funded for our competitors throughout the world, I do not see why it cannot be done in this country. Other countries recognise the strategic importance of investment in energy research and development and their Governments carry out the necessary long-term research.
Let us compare the Department of Energy's record for expenditure on research and development with that of the United States. Our expenditure on coal research and development was £2·6 million and for nuclear it was more than £200 million. In the United States next year, their spending will be some $924 million on coal research and development and $791 million on nuclear. They clearly see where research and development is needed if the long-term problems are to be sorted out. Not only are those larger sums than the Government will commit, but they indicate a more rational allocation of resources.
We are not confident that the amendment will ensure the promotion of research and development in the national


interest after privatisation when the Government are incapable of it while the industry is in the public sector. Why is the Secretary of State waiting until after the industry has been sold off before taking that action when he could and should be doing it now? It is obvious that a number of state industries that are involved in energy—whether it be British Gas, which was privatised a few years ago, or the electricity supply industry, which is about to be privatised—will not consider the national interest when carrying out their operations in the private sector. Therefore, should we not be ensuring now that we take action so that the benefits of protection for consumers and for the environment can clearly be seen? We cannot take into account the near-market consideration that the Minister mentioned.

Mr. Eric Illsley: I rise to make a few brief comments on research and development and Lords amendment No. 6. I shall obviously not go into such detail as my hon. Friend the Member for Rother Valley (Mr. Barron), but I want to comment on a couple of topics that were considered by the Select Committee on Energy, of which I am a member.
I have been bashing away at the Department of Energy over the past few months, together with colleagues from around the area and on the Select Committee, about the development of the topping cycle at the Grimethorpe pressurised fluidised bed combustion plant. When giving evidence to the Select Committee earlier this year, the Secretary of State committed himself to saying that a financial package would be put together to fund the topping cycle later this year. Following that, the Select Committee visited the plant at Grimethorpe, as guests of British Coal. We were then told that an £8 million package had been agreed and that the money would be made available to British Coal, together with private investment that had been raised.
We then returned to London and took evidence from the permanent secretary to the Department, who, surprisingly, informed us that finance for Grimethorpe was still under consideration and a figure had not even been talked about. Hon. Members can imagine the surprise of the members of the Select Committee to hear those words from Sir Peter Gregson, when we had been assured by British Coal that all was well and that all it was waiting for was the signing of the cheque.
A report has been produced by the Select Committee on the greenhouse effect. I do not intend to go into that report in detail, but it is noticeable that it advocates that national Governments—our own and others throughout the world—take some sort of action now in response to global warming. Their action could either be to reduce some of the carbon dioxide emissions or to fund further research to try to determine more exactly the problems of global warming.
The Select Committee had the benefit of a seminar earlier this year at which we were informed that part of the climatic research into global warming had not yet been completed, especially in relation to the effect on the oceans. We were told that funding for that research remained to be considered, but that it should be substantial. As a consequence, the Select Committee advocated that the Government should consider spending a percentage of our gross national product on research

into global warming. We felt that it was as serious as that, and that the Government should take a lead in that direction.
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Of course, the Government's research and development programme has been cut in other areas also. Indeed, the Government are looking to the private sector to fund research into all matters relating to energy, such as cold fusion, the fast reactor and the latest one—which is now coming to the fore, but on which there is no commitment to research—super-conductivity at higher temperatures. We were informed as recently as yesterday by the United Kingdom Atomic Energy Authority that it had discontinued its research into cold fusion because it could not reproduce the experiments of professors Fleishmann and Holmes. If the Select Committee is still in being after the recess, and if there is still a Department of Energy for it to shadow, we shall undertake to look into the funding of the fast reactor programme which is another area in which the Government have cut research.
To give the House some idea of the way in which the Department regards the funding of research, I conclude with a few figures. The expenditure estimates of the Department of Energy include the sum of £12 million for the refurbishment of the Department's premises and its move from Millbank to Buckingham gate at a time when the Department's future is under question. No one has yet determined whether the Department will be in being after the next few months. In contrast, the spending on research and development for the current year will be £2·6 million. That compares with at least 20 times that amount being spent on nuclear research and development and it explains why we cannot get a couple of million quid for the Grimethorpe topping cycle.
The estimates paper also contains a section on research and development and on the funds made available to research into the cost of storing petrol rationing coupons. That just about sums up where the Department stands on its allocations of money to its various programmes.

Mr. Michael Spicer: With the leave of the House, I shall respond to the debate.
The hon. Member for Rother Valley (Mr. Barron), who has now come back from the gods, said that we would have a short research and development debate. In fact, we have had a short coal research and development debate—[Interruption.] Yes, it is fine, but that is what we have had.
The two main contributors to the debate, the hon. Member for Rother Valley and his hon. Friend the Member for Barnsley, Central (Mr. Illsley), made two main points. The first was about Grimethorpe and the research and development expenditure which would be made there. The answer is—[Interruption.] Well, Opposition Members will have to wait and see. It is not just perfectly respectable, it is perfectly normal for Governments to enter a cycle of public expenditure reviews as the summer ends and as autumn begins. That is how the parliamentary year and the Government year work. We start our reviews and we work out——

Mr. Illsley: I appreciate everything that the Minister has said. He and I have exchanged views on this during the past few months. The point that we have tried to make on behalf of the Select Committee is that by the time the public expenditure round is decided Grimethorpe will have lost all its best scientists and workers. Even now, key


workers have been lost from the site. They have gone abroad to work on the schemes being operated in Scandinavia. We should like the Government to give some commitment, not in terms of how much money, but simply to end the confusion that has been caused by the Secretary of State, the permanent secretary and British Coal. We have had three different versions of the Government's position on this money. The Government should come out and say, "We do not know how much, but the money will be available", because that would prevent jobs from being lost at Grimethorpe. That is the key point.

Mr. Spicer: To paraphrase the hon. Gentleman, he is saying that the whole thing is falling apart while we wait. However, as he knows, that is not true. Like his hon. Friends who have been assiduous on this matter, the hon. Gentleman knows extremely well that British Coal believes that the position can be held and that the work can continue. The Government are quite properly deciding whether they can put the money behind the project. A public expenditure round is currently under way—I am glad to see the hon. Member for Barnsley, East (Mr. Patchett) in his place because he has taken a great interest in this matter—and public expenditure rounds are the proper way to go about these things.
I repeat that it is not true that the project is falling apart. What is true is that those of us who are concerned about the future of the coal industry—as I am, and I know that Opposition Members are also—must accept that the topping cycle is not likely, on the assumptions that I have seen, to have more than a 15 to 20 per cent. effect on CO2 emissions. We must compare that with the 40 per cent. effect that could be made by a modern gas-fired power station. If one is thinking about CO2 emissions, as we are because that is one of the main considerations, one must keep those figures at the back of one's mind. It is perfectly proper that we should assess any expenditure that we make on the topping cycle in that context.
However, it is wrong to say that the Government are dragging their feet in such a way that the whole project is in danger of coming to a halt. The Government are going through their normal expenditure review processes. That is quite proper. British Coal is clear that the situation can be contained throughout that period and we shall make our decisions at the appropriate moment. We have already said that we are extremely interested in what is coming out of Grimethorpe. I cannot say any more to the hon. Member for Barnsley, Central except that I completely disagree that the position is collapsing and that we have gone beyond——

Mr. Terry Patchett: Given all that the Minister has said, when does his Department intend making the decision on the Grimethorpe fluidised bed?

Mr. Spicer: A proper decision will be made in time which involves——

Mr. Patchett: When?

Mr. Spicer: —the institution being a going concern. There is no question of our allowing it to run down and then making the decision. The hon. Gentleman is pressing his case, but he is being a little unreasonable. As I have said, it is perfectly proper for the Government, as part of their public expenditure round, to consider whether to spend money on this operation. It would also be perfectly proper for the hon. Gentleman to get excited if the review

process was automatically destroying what is going on up at Grimethorpe, but it is not. The operation is capable of continuing at the moment. We shall then make a decision in time——

Mr. Patchett: When?

Mr. Spicer: —for the operation either to continue or to be closed down, if that were the decision.
I have already told the House that the topping cycle is an extremely interesting piece of research and development—[Interruption.]Well, I am saying it now if I have not said it before. There is no question at the moment of the research being wound down or out. I must remind the House that this is only one way—and perhaps a more limited way than can be found with other forms of electricity production—of affecting CO2 emission levels.
The hon. Member for Rother Valley seemed to imply that the Government were dragging their feet on FGD. There is no question but that we shall insist that the industry complies with the EC directive that the United Kingdom should achieve a 60 per cent. reduction in sulphur dioxide emissions by the year 2003 compared with 1980 levels. If one takes into account nitrogen oxide programmes, that will result in expenditure of £2 billion by the industry.

Mr. Barron: I am saying not that the Minister is dragging his feet but that the generators say that if the longest contract that they can have with the supply boards is five years their investment in reducing emissions will be in considerable danger because of the time that building takes. I do not know whether this is a matter for the Department of Trade and Industry or the Department of Energy, or a mixture of both with No. 10 Downing street. The generators would like contracts which extended over a period which was long enough to enable them to invest in cleaning up the power stations.

Mr. Spicer: I understand the hon. Gentleman's point. We shall ensure that the EC directive and the objectives associated with it in terms of the reduction of sulphur dioxide emissions will be complied with.

Mr. Barron: Will the Minister ensure that they start building programmes which are designed to do that? That is the assurance that we and the country need. We need to be assured that building for FGD and the power stations can go ahead without interruption.

Mr. Spicer: We shall not be building any power stations because we are privatising the industry, but it is legitimate for the hon. Gentleman to ask how that will be done. The answer is that the industry will have to comply with the EC directive and with the United Kingdom's policy associated with that objective, and it knows that.
The hon. Gentleman asks for an assurance that the Government will ensure that the directive is complied with and I give him that assurance. It is our policy that those emission levels will be reduced.

Mr. Barron: Does the Minister agree with the statement that I read out which was made by the noble Baroness Hooper in the other place?

Mr. Spicer: My noble Friend's comments in the other place were in line with everything that I have said. My


noble Friend put her points cogently. I agree with them, and that is why I ask the House to agree with the Lords amendments.

Question put and agreed to.

Lords amendment No. 90 agreed to. [Special entry.]

Lords amendment: No. 7, in page 3, line 29, at end insert
and a duty to take into account, in exercising those functions, the effect on the physical environment of activities connected with the generation, transmission or supply of electricity.

Mr. Michael Spicer: I beg to move, That this House doth agree with the Lords in the said amendment.

Madam Deputy Speaker: With this it will be convenient to take Lords amendments Nos. 119 to 128, 130 to 139 and 141 to 143.

Mr. Spicer: When the Bill was being considered in Committee concerns were expressed that its environmental provisions were not strong enough. The Government have considered the matter and we have talked to representatives of environmental groups. The result is a package that the Government are bringing forward under this group of amendments to schedule 9 and clause 3. As I am sure hon. Members know, they have been warmly welcomed.
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A number of changes have been made in the other place, particularly to schedule 9. Licence holders and exempt generators and suppliers will now be under a duty to do what they reasonably can to mitigate the effects which their proposed developments will have on the natural beauty of the countryside and the other features listed. The duties on generators now apply also to subsequent changes in the operation of stations.
The Secretary of State will have a duty to have regard to the extent to which applicants for consents under clauses 38 and 39 have complied with the duties under schedule 9. Licence holders are now required, in consultation with specified environmental bodies, to prepare statements setting out how they will perform their environmental duties.
In response to the strong feeling that there should also be an environmental duty in clause 3, the Government have introduced an amendment which places the Secretary of State and the director general under the duty to have regard, in carrying out their functions, to the effect on the physical environment of activities connected with generation, transmission or supply of electricity. The result is a Bill with rigorous, precise and practical environmental provisions which should commend themselves to the House.
As has been said a number of times, but it bears repeating, the Bill's environmental provisions do not stand alone. There are 15 Acts of Parliament and 14 EC directives which bear on the way in which the electricity industry impinges on the environment. Giving effect to one of the directives are the regulations issued earlier this year which require environmental assessments to be provided for projects likely to have a significant effect on the environment.
From the beginning we have maintained that the Bill will benefit the environment. We have explained that

schedule 9 in particular was a more far-reaching provision than had ever existed before. However, we have further strengthened it by those amendments.
The electricity industry is often compared with the water industry. The water industry can positively beautify the land, but, whatever hon. Members' view of the beauty of power stations or overhead lines, it is difficult to imagine building a power station which positively beautifies the countryside.
We have made sure that when power stations are built or overhead lines put up their effect on the environment will be seriously considered. We have gone further than that and said that their effects on the environment should be mitigated.
We are talking not just about the beautification of the countryside but the way in which the industry pollutes the atmosphere, and that is why we are introducing such tight restrictions, particularly on sulphur dioxide emissions.
The electricity industry is different from the water industry and any comparison is inappropriate. We think that we have it about right. We have listened carefully to what has been said by hon. Members on both sides of the House, and I hope that they, and especially the hon. Member for Wentworth (Mr. Hardy), will welcome what we have done.

Mr. Hardy: I am afraid that I cannot offer the Minister the congratulations that he appears to be angling for because the Government have, quite simply, been tinkering. When we debated schedule 9 in Committee, the Government would not accept my amendments, even though Conservative Members made one or two noises of approval. Those noises were not translated into votes, but we hoped that they would encourage the Minister to take a more positive view.
I warned the Minister that the House of Lords was not so docile or obedient as his Back Benchers. Indeed, it resisted the blandishments of the noble Lady in charge of the Bill. Earlier this evening I referred to her skilful presentation, which was reflected in her approach to the environment. There were echoes of the Minister's speech in her speech, or perhaps it is the Minister echoing the noble Lady. In that debate on 25 April she said:
we have a very positive story to tell. I have recently had meetings with representatives of the Nature Conservancy Council, the Countryside Commission, the Council for the Protection of Rural England and Friends of the Earth, and I understand their concerns. I shall of course listen closely to what noble Lords have to say today."—[Official Report, House of Lords, 25 April 1989; Vol. 506, c. 1157.]
It might be that the tinkering with the Bill following that Lords debate represents an improvement, but if so it is far too modest. Ministers have not made it clear that the conservation bodies in Britain, which they listed in their accounts of consultation, showed an absence of support and enthusiasm for the measure. Indeed, we may be reaching the point where the House is being misled. That reminds me of a week last Monday, when I switched on the car radio and heard comments by the Secretary of State for the Environment, speaking in Newcastle. He boasted that the Government's record on the environment was superb and that all the green organisations and individuals were guilty of distortion or dishonesty in suggesting that their record was less than satisfactory.
The right hon. Gentleman went even further and announced that the Government were proposing to set up an office to disseminate accurate information about the


environment. Ministers have been challenged to give one example of dishonesty, inaccuracy or excessively sweeping statements by the responsible conservation bodies and individuals—but so far they have been unable to find even one.
Because the Government often boast without good reason of a record that is not good enough, we are entitled to be cynical, suspicious and critical of the proposals before us. One reason for my suspicion is that only yesterday I learnt that one large power station intends to cut the number of welders working in teams on a 24-hour shift rotation from 20 to five. That means that four welders will work the day shift, with one working all the anti-social hours. What will happen if something goes wrong? The present publicly owned responsible industry has welders available to deal with any leakage. Very often large power stations are a long way from the homes of its workers—[Interruption.] I hope that the Minister is listening because he must tell us what will happen if there is a problem. Some of the workers may live 40 or 50 miles away from the power stations. My hon. Friend the Member for Ashfield (Mr. Haynes) represents people who work in power stations that are far away from their homes. If 15 of the 20 welders are to lose their jobs—[Interruption.] The Minister's parliamentary private secretary, the hon. Member for Cannock and Burntwood (Mr. Howarth), seems to think that I am making an inappropriate comment when in fact it goes to the heart of the problem. If 15 of the 20 welders have to go, there will probably be only one or even no welder working at night. The power station may still be operating and any emission, leakage or pollution could he serious because they will have to call out a welder who has probably already done a great deal of work and is entitled to time off.

Mr. Haynes: My hon. Friend is talking about safety in the electricity industry. During questions today the Prime Minister was asked about safety in industry and she said that it was the No. 1 priority for the Government. How does that square with what my hon. Friend is saying?

Mr. Hardy: My hon. Friend will be aware that the incidence of serious injury and fatal accident in the coal mining industry during the past three or four years, per 100,000 shifts worked, has risen substantially. It is not just the safety factor that is important. My point is that currently Britain's power stations have a sufficiently skilled staff immediately available to deal with any problem, malfunction or breakdown. Under privatisation, they will no longer be available.
I recall that a group of hon. Members, under my chairmanship, visited Hinkley Point power station a number of years ago. An incident occurred during our visit, and I and one or two of my colleagues were castigated by one or two newspapers because we refrained from making any scathing comment. Some equipment had malfunctioned, but we were satisfied that it had nothing to do with the nuclear aspect of the operation. A simple machine broke down and released some non-noxious gases. Having established those facts, we refused to make any public comment—although one or two newspapers wanted us to make some scare talk.
Perhaps the right hon. Member for Yeovil (Mr. Ashdown), who now leads the Social and Liberal Democrats, would have welcomed the opportunity to make such comments. We felt that it would be

unreasonable to make such comments because the electricity industry dealt immediately with the minor malfunction. It would have been both wrong and impertinent to make some cheap, speculative comments. My point is that at that time we could afford to decline to become involved because we knew that skilled staff were readily available to deal with the problem. We now know that the work force, including fitters and welders, is to be substantially reduced, and that outside the normal day shift there will be only a skeleton staff—if that.
We are surely entitled to be particularly concerned about environmental risks. If a pipe fractures or a machine breaks down, the plant may have to contact a worker in the constituency of my hon. Friend the Member for Ashfield or perhaps even in mine. There are living in my constituency power workers who are employed miles and miles from their homes. They will have to travel a great distance to deal with a breakdown at a time when they are supposed to be off duty.
The Government are clearly embarking on the same course that is followed in the steel industry, of relying increasingly on contract labour. The CEGB has a proud record of training, but I suspect that the level of training and the number of apprentices are already falling. In their place, contract labour will grow and the training function will diminish. The labour skills available to the industry will then contract.
With that in mind, the conservation bodies are justified in being highly suspicious of the Government's attitude. The Government know very well that just as privatisation of the electricity industry is particularly unpopular in green and environmental circles, it is not commanding much public support either—despite the blandishments of the Government's very expensive television advertising campaign.
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Consequentially, the price of the industry's shares may be much lower than the Government originally hoped. It is not only that which worries me. As the flotation approaches, and as the City grows increasingly worried about being left with shares on its hands, City interests and underwriters will run to the Minister to say that the shares are not moving quickly because the Government tightened environmental controls rather more than the City wanted—even though the rest of us realise that those controls are grossly inadequate.
The Minister, in his brief and complacent speech, seemed to suggest that the House should feel grateful to him for his generous and thoughtful consideration of environmental issues. In truth, the Bill is bad, and it has not been improved nearly enough. It is bitterly resented by conservationists. The Minister should have something to say to the people who cannot even wait for the House to complete its consideration of the Lords amendments before telling the skilled workers who made the industry as clean as possible, within the limits of the industry's investment policy, that there will be lots and lots of job losses.
The Minister may think that I am oversuspicious. He may recall that some months ago I spoke in the House about the fears held by many of substantial job losses. I echoed the anxieties and suspicions of the unions representing workers in the industry when I said that I was fearful of substantial redundancies and that the corners of


safety and of environmental protection would be cut. The Secretary of State assured me that, far from there being fewer jobs, there would be more.
Where are those jobs to come from, when fitters and welders are already being made redundant? Is one contract worker to count as 10 skilled artisans? The situation is such that suspicion is certainly justified. I am still waiting for the Secretary of State to tell me that he made a mistake when he gave an assurance that many more people would be employed in the industry.
The information reaching me even before we complete the first of the two days set aside to consider the Lords amendments leads me to believe that I am entirely justified in expressing our unhappiness at the Minister's proposals and that the changes he makes, and which he believes are of a salutary nature, are mere tinkerings. Certain aspects of the Bill have been given insignificant and grossly inadequate priority. I only wish that the Chamber was completely full, so that I could divide the House and express my opinion more forcibly in that way.

Mr. Morgan: My comments are aimed at supporting and amplifying the comprehensive account of the Opposition's considerable concerns for the environment given by my hon. Friend the Member for Wentworth (Mr. Hardy). He was reasonably fair to the Minister, who told us of his pride in the amendments presented in the other place, which together write certain environmental protections into the Bill. However, we do not entirely share the Minister's pride.
We have always felt a good deal of respect for the diligence of the junior Minister. We were always able to tell whether it was dinner time by whether the Secretary of State was absent, in which case the "parliamentary Charlie"—as we used to call them when I was a civil servant—had to man the boat, sinking or otherwise.

Mr. Haynes: He was manning the boat all the time.

Mr. Morgan: As my hon. Friend says, the hours put in by the junior Minister at the Dispatch Box were phenomenal—which clearly implies that those put in by the Secretary of State were not.
Are the powers granted in Lords amendment No. 7 really so great? Let us take a difficult environmental issue such as the decommissioning of a nuclear power station. Is it reasonable for National Power and the Scottish subsidiary company to decide to top it up with concrete and leave it for 100 to 150 years, preferring that course to the Swedish method of de-irradiating and disassembling the thing so that it turns into farmland within 25 to 30 years—that being the shortest period compatible with the safety of the workers who would have the job of removing it? That is probably the largest single job related to the physical environment that the industries will have to face over the next half century, century, or century and a half.
Let us suppose that the Secretary of State, or the director general, suddenly decides that he is not happy with National Power's proposals. Under Lords amendment No. 7, the Secretary of State has a duty to take into account
the effect on the physical environment of activities connected with generation, transmission or supply".
Will the Secretary of State have the power to say, "I am not happy to allow a power station with a concrete cap and

a bit of grass topping to be left for 150 years; I want you to use Swedish technology to get rid of it in a shorter time so that it can return to its previous use"?
We must also consider indirect effects on the physical environment. We have already heard a good deal—today and, from time to time, from the Prime Minister via the usual megaphone—about global warming. Let us say that the global-warming threat, as foreseen by some scientists, turns into a near-market threat confirmed by the vast majority of scientists. If Britain and other advanced industrialised and industrialising countries continue to expand electricity generation at the same pace, the physical environment may be damaged in a way that we can hardly imagine today, with sea levels rising by 7ft or 8ft.
Under the amendment, would the Secretary of State have to deal with that? Would the Government say, "We must do something drastic about carbon dioxide emissions. There must be an international treaty, and Britain must contribute its share"? The Prime Minister has implied that she would almost welcome the opportunity to lead such a crusade, and clearly, if the scientific evidence is corroborated over the next decade, the entire country—indeed, the globe—must face up to the problem.
The Minister has already implied that the powers in the amendment are of huge significance in the context of water privatisation, but are not worth a row of beans when it comes to the electricity industry—which, by its very nature, does not possess the up-country land holdings held by the water industry. It has only lines of pylons and a small number of power stations. The Minister is being terribly static in his thoughts.
My hon. Friend the Member for Barnsley, Central (Mr. Illsley) has already mentioned the immense amount of interest around the world in research and development into superconductivity. As this is probably our only opportunity to consider the reorganisation of the industry over the next 10 or 20 years, if superconductivity were to become a financial reality it is a practical proposition to ask whether we want pylons in our national parks and pleasant countryside or whether we should bury them underground. That would be feasible if the more optimistic views of superconductivity become true. Overhead pylons would no longer be necessary as superconductivity does not need the cooling power of the air and it would be quite possible to put them underground.
Is this the power under which the Secretary of State and the director general could call together those in the industry and say, "Supercondutivity is now an option and we are under pressure from walkers, ramblers and so on"? A practical example which could arise in the next few years, even if superconductivity did not become a reality, involves an issue that has been heavily touted by the Minister and his ministerial colleagues—the Minister of State, Scottish Office is in his place—that of greater Scottish exports of electricity south of the border. I am informed that that can be done by expanding the interconnector where the Scottish and English systems meet, and that a major increase in the north-south line would be needed, and that to avoid brownout there would have to be cross-bracing lines across the famous, or infamous, Harker Stella route around Hadrian's wall. That issue arises every time the legislation has the side effect of expanding the commercial attractiveness of direct export from that massive Scottish surplus of electricity generating capacity, which we keep hearing about, to the


power-hungry regions of central and southern England. It cannot be done without cross-bracing lines to cover the north-south lines, otherwise brownouts become a danger as it will be difficult to maintain system stability. All those cross-bracing lines will cross the Pennines and then there will be trouble from the environmentalists.
Is it under Lords amendment No. 7 that the director general and the Secretary of State and his ministerial collegues at the Scottish Office would have to scratch their heads and ask, "What is the price on the environment in the Pennines? How many additional power lines and how much environmental opposition are we willing to brook to facilitate greater Scottish exports?" Would they have to consider how to balance the environmental interests with the economic interests of free trade in electricity between Scotland and England under Lords amendment No. 7?
Finally, I shall make one small point about Wales, as I could hardly discuss Scotland and England without mentioning Wales. Is Lords amendment No. 131 already out of date by virtue of an announcement that has been made since the Lords amendments were printed? The Secretary of State for Wales announced the merging of the regional Nature Conservancy Council, which is part of the Nature Conservancy Council for England and Wales, and the Countryside Commission for Wales which was probably a regional branch of the English organisation, into one separate statutory body which is not mentioned in Lords amendment No. 131. Will the Minister require further to amend the legislation to take account of the alterations that have been announced but obviously have not taken effect yet? Obviously Ministers will have to consider whether the Welsh element now needs a separate mention in Lords amendment No. 131.
The Minister will have realised that we have considerable worries as to exactly what Lords amendment No. 7, of which the Minister is inordinately proud, is intended for, apart from trying to win a few Green votes on the cheap. We should be grateful for any illustrations or any light that he can put on the matter this evening.

Mr. Michael Spicer: I will write to the hon. Member for Cardiff, West (Mr. Morgan) on the final point he made about Wales—unless I discover the answer during the evening—because it is a technical and specific issue.
The hon. Member for Wentworth (Mr. Hardy), who has been interested in the campaign on this subject for a long time, should learn to recognise good news when he hears it. He is familiar with the bodies that are concerned with environmental matters. For example, I have before me a letter written to my noble Friend the Parliamentary Under-Secretary of State for Energy by Mr. David Astor, the chairman of the Council for the Protection of Rural England, in which he said:
We are delighted that you have now accepted the underlying thrust of our arguments.
The deputy chairman of the Nature Conservancy Council, Sir John Burnett, wrote:
It is excellent news that nature conservation requirements are now being given statutory force.
There is clearly a difference now—perhaps there always was—between the hon. Member for Wentworth, who is normally very much in touch with these events, and those who are directly responsible for representing the interests of nature conservancy and the countryside. The hon.

Gentleman might take note of, and place more emphasis on, what is being said outside the House about the amendments.
The hon. Member for Wentworth spoke at length about safety. The amendments with which we are now concerned are about the environment. There is a lot in the Bill about safety and I urge the hon. Gentleman to consider, for example, clause 3(3)(c) and (d). Those provisions explain the duties that the director and Secretary of State must take into account in terms of the safety of employees and, in subsection (3)(c).
to protect the public from dangers arising from the generation, transmission or supply of electricity".
That came about as the result of an amendment made on Report, following much discussion on the issue in Committee. The hon. Gentleman should have recognised that.

Mr. Hardy: I have not seen the letters to which the Minister referred, from Mr. Astor or from the deputy chairman of the Nature Conservancy Council. People from the conservation bodies who spoke to me on many occasions at earlier stages of the Bill have not been back to me to express the more approving views to which the Minister referred. I am not casting doubts on the hon. Gentleman's integrity, but he might care to read the remainder of those letters to satisfy himself—and perhaps eventually the House—that the words, which may appear to be complimentary, used at the beginning of the letters are not later qualified by expressions of regret about continuing inadequacy. I did not wish to raise the question of safety. That note was injected into my speech as a result of an intervention by my hon. Friend the Member for Ashfield (Mr. Haynes).

Mr. Spicer: Leaving the final part aside, I regarded that as a noble intervention by the hon. Gentleman. He admitted that he was not completely up to date with the latest thinking on the part of those organisations. That was frank and honest of him and there seems to be little between us.
The hon. Member for Cardiff, West spoke in particular about amendment No. 7, which says that in conducting their duties under the Bill the director and the Secretary of State shall take account of the effect on the physical environment of their actions. It means precisely that, and to appreciate the effect of it one needs to consider the duties that they must perform and then read the entire Bill to see how those duties are carried out. As they wade through the Bill carrying out their duties—doing the various things that they can do under the measure—they will have to bear in mind the effects on the environment of those duties. That is not to say that the amendment introduces some great new interventionist facility. The points that the hon. Gentleman made about that come under the normal planning procedures. For example, the question whether Hinkley Point, as against some other construction, is to be built is a matter of detail and planning, and those planning laws are not affected by the Bill.

Mr. Morgan: I do not know whether the Minister misheard me or whether my direct questions threw him completely. I was not talking about the building of new nuclear power stations. That is clearly determined by normal planning inquiry procedures.
I asked about the decommissioning of nuclear power stations. Will the Secretary of State or the director general have the power to question and then to determine whether he is satisfied with a particular form of decommissioning and its effect on the environment? If it is proposed to cap a reactor with a concrete dome for 150 years, could he say, "I am not happy with that" and insist that it be taken away within 25 years? I was talking not about the building of Hinkley Point but of the removal of Berkeley.

Mr. Spicer: The hon. Gentleman should read the Bill. I know that he has. I think I have the answer here.

Mr. Morgan: What does it say?

Mr. Spicer: Well, it does not say an awful lot. I will read it out in a moment. It says that this is for the nuclear installations inspectorate, but I think that I can do better than that.
The hon. Gentleman knows that the regulator, when he carries out his duties under the terms of the Bill, has to consider the price formula. We all have to consider that. When carrying out those assessments, the regulator, if the amendment is accepted, will have to bear in mind—and he can be challenged about it, because it will be in the Act if the House agrees to it—the impact of his decisions and actions on the environment. I think that that gives the hon. Gentleman a precise answer. We would have to debate and discuss the entire Act to see how it would impinge on the decommissioning that the hon. Gentleman raised.
This is an important amendment, which pervades the Bill. Every time the director general considers what he is doing he has to bear in mind the environmental impact.
I think it is perfectly right that the hon. Gentleman should ask these questions, but I think that Opposition Members have been, for want of a better word, churlish. The hon. Member for Wentworth has accepted that he is a bit out of touch with the latest thinking of conservation bodies. It was generous and proper of him to declare that. As I have now informed the House of the latest thinking of the conservation bodies, I hope that it will welcome these amendments with open arms and with approbation. They have been welcomed widely outside the House.

Mr. Morgan: rose——

Madam Deputy Speaker: Order. The House is on consideration of Lords Amendments, and the hon. Gentleman has already spoken.

Mr. Morgan: With the leave of the House, I did not want to allow the word "churlish" to pass without some comment. There is a fundamental difference between writing a note to the Countryside Commission asking for a pylon to be moved half a mile to the left, which is one interpretation of the clause, and saying, "No, I am not happy with that nuclear power station being left under a concrete dome for 150 years, even if it costs an extra £1 billion on your cost formula to remove it after 25 years." Nor is that the same as saying that we must take account of the global warming threat, that we are worried that London will be under 6 ft of water and that the only solution is to try breast stroke. Those are quite different considerations.

Mr. Spicer: With the leave of the House, I unreservedly withdraw the word "churlish." Perhaps the word "reserved" should be inserted instead.

Question put and agreed to.

Lords amendments Nos. 119 to 128, 130 to 139, 141 to 143, 11 to 13, 15 to 20, 115 to 117, 53, 54, 57 and 58 agreed to.

Clause 45

GENERAL FUNCTIONS

Lords amendment: No. 59 in page 35, line 33, leave out from "activities" to second "and " in line 34 and insert
to which this subsection applies

Mr. Michael Spicer: I beg to move, That this House doth agree with the Lords in the said amendment.

Madam Deputy Speaker: With this it will be convenient to take Lords amendments Nos. 60 and 61.

Mr. Spicer: The effect of Lords amendments Nos. 59 to 61 is to ensure that, in keeping under review activities connected with the generation, transmission and supply of electricity, the director general should also keep under review, in particular, activities connected with combined heat and power. This will help him in carrying out his other duties under the Bill, such as the duty in new clause 3 to promote competition in the generation and supply of electricity.
Placing the interests of combined heat and power in the Bill must be seen in the context of what the Government are also doing for combined heat and power. We are funding a number of research projects up to £750,000 in total and are giving statutory undertaker powers to CHP operators comparable with other forms of electricity generation. We are putting the rating of CAP on the same level as others. Above all, the Bill is making fundamental changes, taking away the grid from a single generator and giving CHP free and fair access to the system.
The Bill is doing a tremendous amount for CHP, but, to underscore that, we thought that we would accept the Lords amendments. I ask the House to accept them.

Mr. Barron: I do not intend to prolong the debate, but we should discuss these amendments for a few minutes. The Opposition are pleased that these provisions are to be included in the Bill. There were lengthy debates in the House, in Committee and on Report about the future of combined heat and power. I was fascinated also to see how the constitution could be so elastic in terms of the ability of the other place to carry on debating changes in our legislation.
Although we do not have combined heat and power in the Bill specifically, as Lord Ezra wanted, I am pleased that there is a reference to cogeneration:
heat produced in association with electricity and steam produced from and air and water heated by such heat".
That is exactly what has happened in this cycle. I do not want to go into the technicalities, but it is important to note that the Government are moving in the direction sought for many years by people working in the industry.
It will be one of the general functions under clause 45 that the director should "keep under review" the development of combined heat and power. That takes us no further forward than we have been since the Energy Act 1983, when the Government decided to review the


development of combined heat and power. Any advance since then has been despite the Government and not because of them.
9.30 pm
The amendment will not alter the position. I do not share the Minister's confidence that combined heat and power projects will have wide opportunities of getting into the system and being able to take part in the so-called "competition" that we have at present. CHP developments are at a critical stage, yet the Government still take little action. Despite their professed support for CHP, they have not taken the opportunity presented by the Bill to remove the blockages that exist and they have even invented new ones, such as the problem of CHP projects in getting electricity into the system. The electricity boards have failed to negotiate adequate purchase prices for combined heat and power schemes and the Government show no signs of taking effective action to ensure that the blockage is removed.
On Report, the Minister told us how much money was spent on the Leicester combined heat and power scheme, yet the Government have not removed the blockage that could threaten the existence of the CHP scheme in Leicester. The other major threat to CHP from the privatisation of electricity is through the Government-sanctioned secrecy currently surrounding the contracts working party, which looks set to form a cartel. Many people in the Combined Heat and Power Association and people who have been working on CHP schemes for years believe that it will be designed to keep them out, as cartels were designed to keep them out after the 1983 Act had said that we would have the development of CHP schemes in Britain.
The Government's failure to make their intentions clear for CHP is not surprising. In the debates on CHP during the passage of the Bill, I have not been convinced that the Minister understands the issues involved. On Report, the Minister said:
The Bill will not only give those wishing to engage in this form of technology free access to the system, but there will now be a duty on public electricity supply companies to buy from the most economic sources. Therefore, if CHP is the most economic source, that duty will take effect.
I am pleased to see that the hon. Member for Erewash (Mr. Rost) is in his place. During the debate, he brought up the point that had been argued for many years by people trying to get combined heat and power into the market place. He argued that the case for CHP was made not on the basis that it would generate electricity cheaply, but that:
By using hot water from electricity production instead of throwing it away, we create more diversity, more energy efficiency and we reduce the greenhouse effect."—[Official Report, 6 April 1989; Vol. 150, c. 443–46.]
That argument is right, but we must recognise that the hot water is normally taken away from the generation before it would have been if one was just generating electricity. On that basis, the generation of electricity is likely to be more expensive than it would be from conventional plant. That is where the problems lie for CHP in breaking into a competitive market which does not understand the uniqueness of the technology we are proposing to use. As the hon. Member for Erewash rightly said, CHP has an effect on the environment as well. By the more efficient use of energy, it can go some way to help us in dealing with environmental problems.
The Energy Select Committee's recent report on the greenhouse effect highlighted the benefits that efficient power generation by combined heat and power could bring. According to the CEGB, some CHP plants could reduce greenhouse emissions by up to 60 per cent. British Coal is already showing the way forward. The planned circulating fluidised bed CHP schemes at Slouth Estates is a pathfinder. That commitment is far in advance of anything that the electricity supply industry seems prepared even to discuss.
Not too many years ago, I had discussions with the chairman of the CEGB on this unique method of using energy in our communities. I shall never forget his remark that if British Gas were taken out of a place like Leicester, he would go in because he could sell not only electricity but water for space heating and domestic use. For years CHP has had problems getting a foothold in the market. Until we understand that and make special provisions for CHP schemes, we shall have problems developing it.
It is a great shame that the Government have failed to take the opportunity presented by this massive change in the electricity supply industry to give CHP the boost that it needs. I urge the Minister to turn his professed support into practical action in the not-too-distant future. The Bill says nothing more about this technology than was said in the Energy Act 1983. I hope that a future Secretary of State or director general will look seriously at CHP and find a place for it in the market so that it can develop as the amendment proposes.

Mr. Rost: I am grateful to the hon. Member for Rother Valley (Mr. Barron) for his references to my contribution to debates on this Electricity Bill, and in previous years.
The hon. Gentleman referred to the Leicester combined heat and power schemes. He may not be aware that this afternoon I received by fax—telecommunications technology seems to be moving even into this place—the most alarming news that work on the Leicester project has been suspended. The 110 MW scheme by Leicester Energy has been the showpiece of CHP development. Apart from the Sheffield scheme, it is the only scheme going ahead. It involves a private enterprise consortium of six major companies and I declare an interest as a consultant to one of them. The project has progressed for the past 16 months and negotiations have now come to a conclusion. The talks have collapsed and work on the project has ceased because of the uncertainties surrounding the privatisation of the electricity industry, particularly the contract for the sale of electricity.
I shall not bore the House with the technical details of why the negotiations have broken down, but I use this example to compare what is happening in this country with developments in towns and cities in western Europe. Over 300 already have CHP district heating schemes and many others are being developed. Such schemes have made a huge contribution to reducing fuel consumption and global greenhouse warming. Thermal efficiency has, been doubled by using the hot water as well as the electricity from combined production.
I hope that my hon. Friend the Minister will look at the letter that he will have received a couple of days ago from the Leicester combined heat and power company explaining the difficulties that it is having in getting this project further progressed because of the uncertainties of the electricity contract. I hope that he will use this as a reason for giving further thought to the amendment that


my hon. Friends on the Front Bench have proposed to the Bill. I welcome the amendment because it at least opens the door and obliges the director general to monitor progress on combined heat and power. However, monitoring will not be enough when one of the two major projects has come to a halt. What will he monitor? We need a stronger amendment. I regret that none of the three efforts of the other place to change the Bill in this respect have been accepted by the Government. I regret, with a personal interest, that the amendment that I moved on Report was not accepted either.
The Government will have to come back to this, simply because the contribution that the more efficient generation of electricity can make to electricity prices and the environment will oblige them to assist in solving the major problems affecting large-scale city combined heat and power projects. These projects are marginaly economic, but they are more economic than nuclear power. Nuclear power is getting a special and open-ended subsidy in the Government's strategic policy, as is renewable energy. I do not complain about the special help to these two sources of energy, but, like energy efficiency, combined heat and power can make an important contribution not just to strategic diversity of supply but to the relief of environmental pollution and the greenhouse effect, as it is doing increasingly in other countries. It should have been given a more important promotional opportunity in this legislation, as it needs Government help to help it to overcome the high up-front infrastructure costs of laying district heat mains.
Industrial combined heat and power projects are going ahead fast, and all the projects that were held up previously are suddenly taking off. The Government deserve full credit for that because it would not have happened without the privatisation of electricity. This is giving industry the power to set up its own combined heat and power generation by allowing it to get a fairer price for the surplus electricity. These projects are going ahead with a pay-back period on the investment of about three years.
There are still enormous problems with the larger scale schemes, and I hope that the Government will either take note now, or accept that these problems will have to be solved with their help if we are to make a contribution to energy efficiency and the global warming effect.
While I welcome the Lords amendment, it would have been more beneficial if the Government had gone a little further and accepted one of the three amendments that the other place tried to introduce, as they would have given more power to the promotion of this most important technology, which other countries have adopted, which is economic and cost effective and which needs a stronger market stimulus than it is getting at the moment.

Mr. Michael Spicer: My hon. Friend the Member for Erewash (Mr. Rost) has been persistent and effective in arguing the case for combined heat and power. Perhaps my hon. Friend was temporarily away from his place when I explained why the Government wished to accept the amendment which will introduce into the Bill the interests of combined heat and power. That is an important addition.
My hon. Friend mentioned the Leicester scheme. The Government invested £250,000 of taxpayers' money in the initial preparations for that scheme but it would appear that the scheme is not now to go ahead because the contracting parties find that they cannot contract at an economic level. There is nothing much that the Government can do about that.
We certainly believe that—the hon. Member for Rother Valley (Mr. Barron) quoted me correctly—combined heat and power should compete fairly with other forms of electricity production. At the beginning of my opening speech I listed the things that the Government have done to ensure that CHP can compete fairly, which it could not do hitherto because of rating, statutory undertaker arrangements and the way in which the industry was structured to inhibit new entrants such as CHP.
Part of the case for CHP must be that it is competitive and economic. That is why it has been so successful in industry, and why it currently produces 2 GW of electricity. We know of a number of schemes for the industrial use of combined heat and power which may result in its producing twice that amount in future.
CHP ought to be able to compete freely and fairly and stand on its own feet——

Mr. Rost: My hon. Friend referred to the Leicester scheme and suggested that work had been suspended because the economics were not proving as good as had been expected. I assure my hon. Friend that that is not the case. The brief sent to his Department by Leicester Energy will confirm that. The problem is not that the econonics are not robust but that Leicester Energy needs a long-term contract to make the scheme bankable. The area board is not prepared to offer a long-term contract based upon an escalation clause in respect of the price of gas, although it is a gas turbine scheme. The problem arises from the lack of a long-term contract.

Mr. Spicer: My hon. Friend has made the point that I sought to make. The contractual arrangements and negotiations have broken down on the basis of the price that was being requested. The area board took the view that the price was unacceptable. That must be a matter for the contracting parties. If the Government went along with every single proposal put to the area board successor companies, ultimately they would increase the price to the consumer, and the Opposition would be the first to groan and complain and, in this case, they would be right to do so. The industry must take into account the economics of producing energy.

Mr. Barron: Will the Minister tell us why he is prepared to ringfence electricity and to guarantee billions of pounds of taxpayers' money, not just in the flotation but in years to come, to clean up the mess that it creates, but he is not prepared to help protect the Government's investment in the combined heat and power scheme in Leicester? The Minister must know that the cost of electricity on a CHP scheme is more expensive than if the industry were just using steam turbines to generate electricity per see. Does he not understand the technology?

Mr. Spicer: It is precisely for the same reason that we ringfenced coal at the cost of £10 billion over the past few years. We believe that nuclear power is a fundamental addition to the range of energy supplies which we wish the country to have in order to ensure that the consumers'


interests will not be put at risk, as they have been on previous occasions through disruptions in the coal industry——

Mr. Barron: Arthur Scargill.

Mr. Spicer: The hon. Gentleman made the point himself—Arthur Scargill. I was not going to mention him today to save the hon. Gentleman's blushes. As he has said that, I am quite happy to agree with him when he says that Arthur Scargill is part of the history of the matter, as are some of the disruptions to our oil supplies and the price of those supplies from other countries.
The question of the security of energy supply in this country is fundamentally a different question. That is why we have protected the coal industry so heavily for so many years and why, as a result of protecting it and putting so much money into the industry, it is now, for the first time, able to face competition with some confidence. That is good and something that we have achieved for the coal industry.
I understand the points made by my hon. Friend the Member for Erewash. He has made them coherently and cogently over many months and years. His labours have borne fruit because the Bill has on its face the recognition of the importance of CHP, not to mention the panoply of actions that we have taken to ensure that CHP competes fairly in the future in a way that may not have happened up to now. I hope that my hon. Friend and others will accept these Lords amendments.

Question put and agreed to.

Lords amendments Nos. 60 and 61 agreed to.

Mr. Speaker: I understand that it is the desire of the House to take Lords amendments grouping No. 66 to the grouping No. 163 formally. Is that correct?

Mr. Hardy: Would you give me some advice, Mr. Speaker? You were kind enough to select my amendment to Lords amendment No. 155. I would like to say a word or two about that.

Mr. Speaker: In that case it would be convenient if we took Lords amendments Nos. 66 to 77 formally.

Lords amendments Nos. 66 to 77, 144 to 153 and 174 agreed to.

Schedule 11

TAXATION PROVISIONS

Lords amendment: No. 154, in page 112, line 23, leave out second "of".

Motion made, and Question proposed, That this House doth agree with the Lords in the said amendment.——[Mr. Michael Spicer.]

Mr. Speaker: With this it will be convenient to take Lords amendment No. 155, in page 114, line 29, at end insert—

Transactions effected in pursuance of section (Transfer Schemes under sections 63 and 64) ( 2 ) ( c)

4A.—(1) Sub-paragraph (2) below applies to any disposal (within the meaning of the Capital Gains Tax Act 1979) which is effected, and sub-paragraphs (3) and (4) below apply to any lease which is granted, in pursuance of a provision included in a transfer scheme by virtue of section (Transfer schemes under sections 63 and 64)(2)(c) of this Act.

(2) A disposal to which this sub-paragraph applies shall be taken for the purposes of the Capital Gains Tax Act 1979

to be effected for a consideration of such amount as would secure that on the disposal neither a gain nor a loss would accrue to the disponer.

(3) Subsection (6)(a) of section 37 of the Finance Act 1978 (capital allowances; long leases) shall not prevent the application of that section in any case where the lease is a lease to which this sub-paragraph applies.

(4) Where, in the case of any machinery or plant which is a fixture and on the provision of which for the purposes of the transferor's trade the transferor incurred capital expenditure, a lease of the relevant land (with or without other land) is a lease to which this sub-paragraph applies—
(a) the lessor shall not be required to bring the disposal value of the machinery or plant into account in accordance with section 44 of the Finance Act 1971 (writing down allowances and balancing adjustments); and
(b) so far as relating to the bringing of disposal values into account, that section and Schedule 17 to the Finance Act 1985 (capital allowances for fixtures) shall have effect as if—
(i) the capital expenditure incurred by the transferor had been incurred by the lessee on the provision of the machinery or plant wholly and exclusively for the purposes of the lessee's trade; and
(ii) the machinery or plant had become a fixture, immediately after the grant of the lease.

(5) In sub-paragraph (4) above "the transferor" means the transferor under the transfer scheme in question and expressions which are used in Schedule 17 to the Finance Act 1985 have the same meaning as in that Schedule; and in construing that sub-paragraph the provisions of section 511(2) of the 1988 Act and the corresponding earlier enactments shall be disregarded."

Amendment (a), to the Lords amendment, to leave out sub-paragraphs (1) and (2).

Lords amendments Nos. 156 and 157.

Mr. Hardy: I shall not detain the House for long, Mr. Speaker, but, as you know, I am interested in the protection of the rare species. When I saw the word "disponer", which I had never seen in a Bill before, I thought it reasonable to table an amendment to the Lords amendment to give the Minister the opportunity of explaining it.
However, I also have a suspicious mind and the other day I asked a supplementary question when the Minister told the House that he had saved the public a lot of money by prosecuting people who had disgracefully and fraudulently falsely claimed unemployment benefit. I suggested that the same resources and the same energy would have yielded a greater harvest if the Government had gone after the tax dodgers. When I read Lords amendment No. 155 and saw a reference to capital gains and the proposal that the disposal should produce
neither a gain nor a loss",
it occurred to me that sometimes a capital gains loss is an asset.
I hope that the Minister will find my illustration interesting. Let us suppose that a writer of modern novels manages to produce one which is sufficiently salacious as to become a best seller. That property may be purchased for film rights, in which case there is a substantial capital gain. If the writer is allowed to set that capital gain against a loss, which could be an entirely notional loss, as a result of this privatisation exercise, he could be a considerable gainer, whether he were a disponer or not.
I shall not seek to press my amendment to a vote, but the Minister should offer us some reassurance and explanation. I have tabled the amendment partly because I want to know why the word "disponer" is included in Lords amendment No. 155 and partly because I want the Minister to give the House an assurance. Since those who


have wished to evade income tax or many other forms of sometimes burdensome taxation have received a great deal of assistance during the past 10 years, I want to be absolutely sure that the privatisation of electricity will not also be possibly helpful in the longer term to those who are fortunate enough to select the small number of boards that might be successful and make a capital gain at the same time.
As I have said, I do not wish to detain the House or to force a Division on this matter, but we are entitled to a degree of reassurance and explanation from the Minister, which I am sure that he would wish to offer in view of the possibility of self-interest arising.

Mr Michael Spicer: It is perfectly fair game for the hon. Gentleman to start picking up words with junior Ministers at this time of night and to ask what they mean. That is a well known and legitimate game, and it is fine. The answer to the hon. Gentleman's questions may be coming from the Box, but I think and hope that I know it before it does.
These provisions are all about the transfer of assets and about disposals. They relate to people receiving new assets because of the schemes that will be coming forward. Through these technical and very neutral amendments, in which there is no question of tax breaks or of anybody gaining, the Government are allowing the transfer schemes made by the Central Electricity Generating Board, the Electricity Council or the Scottish boards to impose on one successor company an obligation to enter into agreements with another. In the case of the CEGB, I refer, for example, to a long-term lease in respect of land within the perimeter of a power station. The purpose of the amendment is simply to ensure that the fulfilment of such an obligation is tax neutral. The implications of that are dealt with in detail. If the hon. Gentleman is worried that gains could be set off against some future losses, the answer is that that could not happen. There is no question of any clever tax manipulation being permitted. The total effect is tax neutral.

Mr. Hardy: I am grateful to the Minister for that explanation.

It being Ten o'clock, the debate stood adjourned.

Ordered,
That, at this day's sitting, the Electricity Bill may be proceeded with, though opposed, until any hour.—[Mr. John M. Taylor.]

Question again proposed, That this House doth agree with the Lords in the said amendment.

Question put and agreed to.

Lords amendments Nos. 155 to 157, 80, and 163 to 167 agreed to. [One with Special Entry.]

Lords amendment: No. 91, before clause 99, insert the following new clause—Amendment etc. of Electricity Supply Pension Scheme—
. The provisions of Schedule (The Electricity Supply Pension Scheme) to this Act (which provide for amending the Electricity Supply Pension Scheme and for giving special protection to certain persons who have or may acquire rights under that scheme) shall have effect.

Motion made, and Question proposed, That this House doth agree with the Lords in the said amendment—[Mr. Lightbown.]

Mr. Speaker: With this it will be convenient to take amendments Nos. 92, 168 and Government amendment (a).

Mr. Frank Doran: The amendments relate to pension and superannuation schemes, which, at the moment, are on a statutory basis. It is unfortunate that pension arrangements did not receive much consideration in Committee. However, I appreciate that that was partly due to the fact that negotiations were continuing with the electricity boards' employers and trades unions and the amendments are the result of those negotiations.
The points that I am about to make relate to this and the subsequent group of amendments. What protection is there for members of existing pension schemes after privatisation? Paragraph 1(5) of new schedule 13 provides that regulations under that paragraph which provide some form of protection can be made only up to the new vesting day. Exactly the same applies to the pension schemes of the Scottish boards. We shall have to see those regulations when they are published, but what protection will there be after vesting day?
My constituents have already raised with me their fears in relation to the North of Scotland Hydro-Electric Board pension fund which is already embarking on a contributions holiday. I should declare an interest because I am still a member of that fund, having worked for the board for about five years.
Contributors to that board's pension fund and others are worried that employers are taking a contribution holiday. I have had experience of private employers who have tended to see the pension fund almost as an asset of the business rather than as an asset of the members of the fund, and I should like some clarification and assurances from the Minister of exactly what protections are on offer once those industries are privatised.

Mr. Michael Spicer: The hon. Member for Aberdeen, South (Mr. Doran) is right to say that the amendments have been brought forward at this stage as a result of consultations with those concerned. My hon. Friend the Minister of State, Scottish Office will answer his specific point on Scotland when he deals with the next group of amendments.
During our discussions of clause 99 in Committee, I gave an undertaking to bring forward an amendment to protect the pension rights of employees transferred to successor companies, in the event of the electricity supply pension scheme being wound up. This provision would replace the existing "no worsenment" protection under section 54 of the 1947 Act. My officials subsequently had long and detailed consultation with the industry and the electricity supply trade union council on the formulation of the no worsenment protection, which was the subject of a great deal of debate in Committee.
As a result of those discussions, the Government tabled amendments in another place to provide the framework for the continuing pension protection for existing employees, pensioners, dependants and frozen-benefit-holders on the transfer date. The Secretary of State is empowered to make regulations to place a duty on employers that such protected persons shall not be placed in any worse position because of the winding-up of the electricity supply pension scheme or through other specified circumstances, including transfers within the industry with continuity of employment. The regulations will enable any disputes arising in respect of the no worsenment provisions to be referred to arbitration.


Because the provisions became so long and so complex, they were transferred into a schedule, together with the original contents of clause 99.
I hope that hon. Members are satisfied that that meets our commitment given in Committee to introduce protections for pensions.

Question put and agreed to.

Lords amendment No. 92 agreed to.

Lords amendment No. 168, as amended, agreed to.

Lords amendment: No. 93, before clause 100, insert the following new clause—
. The provisions of Schedule (The Scottish Pension Schemes) to this Act (which provide for amending the Hydroboard Superannuation Fund and the South of Scotland Electricity Board's Superannuation Scheme and for giving special protection to certain persons who have or may acquire rights under those schemes) shall have effect.

Motion made, and Question proposed, That this House doth agree with the Lords in the said amendment.—[Mr. Lightbown.]

Mr. Speaker: With this we can discuss Lords amendments Nos. 94 and 169.

Mr. Doran: I should like the Minister to tell me about protection for the pension funds of Scottish boards.

The Minister of State, Scottish Office (Mr. Ian Lang): It might be helpful if I said a brief word about the amendments. They transfer the contents of clause 100, which gives the Secretary of State power to amend the Scottish pension schemes, into a new schedule. They also introduce into the schedule new provisions relating to the protection of pension rights for certain persons. They have been prepared along similar lines to the amendment just introduced in relation to the electricity supply pension scheme in England and Wales. Like that amendment, it has two effects. First, it gives the Secretary of State for Scotland power to make regulations amending the two Scottish schemes. Secondly, it gives him the power to make regulations for protecting certain persons against any deterioration of their pension rights under the schemes.

The amendments were introduced with the agreement of the Scottish boards and the trade unions in the industry in Scotland.
As I heard the question asked by the hon. Member for Aberdeen, South (Mr. Doran) in the last debate, I can save him from having to get to his feet. I understand his anxiety on behalf of some of the employees of the hydro board about the security of their pensions under the new arrangements. Privatisation brings no change to the arrangement; the trustees are still subject to the same obligations. If any trustees act fraudulently they will be subject to prosecution. Obviously, trustees must take decisions about investments in funds, and in so doing they take professional advice. Regular actuarial reviews are required by law to ensure that the trustees are aware of the value of the funds in relation to their liabilities. The hon. Gentleman mentioned trustees taking a contribution holiday, but that practice is by no means unusual—especially in recent years. Pension funds have substantial surpluses, and for that reason trustees feel able to take a holiday.
Paragraph 2(1) states:
The Secretary of State may make regulations for the purpose of securing that …
(a) no person to whom paragraph 3(1) or (2) below applies"—
which, for the purposes of the provision, is an employee—
is placed in any worst position by reason of … (ii) any amendment of a relevant scheme which results in benefits under that scheme being reduced, or contributions by employees being increased, and is made otherwise than in such circumstances as may be prescribed".
In other words, the purpose of that paragraph is to protect employees' rights, and the trade unions are well content with those arrangements.

Question put and agreed to.

Lords amendments Nos. 94, 169 to 173, 175 to 181 and 96 to 99 agreed to. [One with Special Entry.]

Further consideration of Lords amendments adjourned.—[Mr. Lightbown.]

To be further considered tomorrow.

Orders of the Day — Education (Assisted Places)

10.11

The Parliamentary Under-Secretary of State for Education and Science (Mr. John Butcher): I beg to move,
That the draft Education (Assisted Places) Regulations 1989, which were laid before this House on 26th June, be approved.
The draft regulations consolidate with certain small amendments, which I will describe, the Education (Assisted Places) Regulations 1985 as amended in 1986, 1987 and 1988.
The assisted places scheme was established in 1981 for the purpose of widening the educational opportunities of able children from less well-off families. It provides their parents with assistance towards the fees of some of the best independent schools in the country. The assistance is on a sliding scale based on parental income, and the principal changes embodied in the consolidating regulations are concerned with the annual revision of that scale.
In past years there have also been technical amendments to keep the definition of "total parental income" for the purposes of the scheme constant as tax legislation changes. This year, one such amendment takes account of the position of assisted places scheme—APS—parents who either receive or pay maintenance payments. But I venture to suggest that all of the amendments, which I shall describe in a moment, are straightforward.
Part I of the draft regulations deals with citation, commencement, application and interpretation. By virtue of draft regulation 1, the regulations are to come into force on 12 August 1989. Part II of the draft regulations deals with eligibility for assisted places, and is unchanged from earlier years.
Part III deals with remission of fees. Draft regulation 11 of part III has been amended to increase from £950 to £1,000 the amount that may be deducted from the relevant total income of an assisted place holder's parents in respect of each child or dependent relative other than the assisted place holder. Parts IV and V cover administrative arrangements and miscellaneous requirements and are unchanged.
Schedule 1 provides for parents' income for the purposes of the scheme to be computed on the basis of their "total income", as defined with reference to tax legislation in regulation 11. The provisions of paragraph 5 of schedule 1 ensure that, despite changes in the taxable status of maintenance payments introduced in the Income and Corporation Taxes Act 1988, APS parents making maintenance payments will continue to be able to offset them against their "relevant income". The provisions also ensure that APS parents receiving such payments will continue to count them as part of "relevant income". The provisions, however, only preserve the status quo as far as the assisted places scheme is concerned.
Draft schedule 2 sets out the income scale used for assessing parents' contributions towards fees. As usual, this has been uprated to take account of movements in the retail prices index. The threshold at or below which parents pay nothing towards fees is raised from £7,258 to £7,584. Draft schedule 3 revokes the 1985 regulations and the regulations amending them

The provisions and amendments that I have described will ensure the continued smooth running of the assisted places scheme, and I trust that they will find favour with hon. Members on both sides of the House.

Ms. Hilary Armstrong: This debate gives us an opportunity to review the workings of the scheme that the Government brought into effect during the passage of the Education Act 1980. It has given me a chance to read some of the Hansard reports of the time, and very interesting reading they made. I have been able to re-examine the Government's intentions in introducing the scheme. The Secretary of State said in October 1980 that the scheme would lead to a greater social mix within independent schools. I have tried to find evidence of the fulfilment of that criterion, but I have to say that the evidence is very thin. It is true that each year almost exactly 40 per cent. of APS pupils have been entitled to free places, and over half have come from families with incomes below the national average. We must, however, ask ourselves whether that constitutes a social mix.
A research project funded by the Economic and Social Research Council showed that over 50 per cent. of pupils had fathers from professional and managerial occupations: only 7 per cent. came from families with manual working backgrounds. The research also found that 68 per cent. of pupils' mothers and 51 per cent. of their fathers had attended selective or independent schools. Very few represented the kind of able working class child whom, according to the initial publicity, the scheme would rescue from inadequate inner city comprehensives.
That is the problem with which we are dealing: those whom the scheme has helped are those who would probably have attended such schools in any case, and whose parents—despite having fallen on hard times, often through divorce—wanted to ensure that their children went to the kind of schools that they had been to.
My predecessor in the constituency of Durham, North-West said in the 1980 debate:
It is unique to this country that we seem to believe that our top civil servants, top management, those who are to be leaders of the community have to be educated in separate schools, having been taken away from the rest of society and moved into a secluded quarter.
So many people who have aspirations towards independent schools see themselves as separate—and wish to separate their children—from the ordinary, everyday stream of life. That is a sad indictment of our society. The assisted places scheme has not led to a greater social mix in independent schools; it has enabled the existing mix to continue.
The Government's second intention was that the scheme would increase the number of working-class children going on to higher education. It is well known that I have been a strong advocate of providing such opportunities. However, the figures and what has happened under the scheme show that the take-up of sixth-form places has never risen much above 75 per cent. and some 60 schools have consistently recruited below their quota. Almost two thirds of those taking up places under the scheme for the first time at 16 are already fee-paying pupils in independent schools. The regulations, in spirit if not in letter, provide that more than 60 per cent. of assisted pupils should be recruited from the maintained sector. It is clear from recruitment to sixth forms that


assisted pupils are coming from the rest of the independent sector. Those two factors mean that the scheme is not providing access to higher education for working-class young people.
A recently published general household survey carried out in 1986 shows that the daughters of unskilled workers proved to be testimony to the belief. It shows that the number of daughters of unskilled workers going to university was less than 0·5 per cent.
The Government's third aim was that the scheme would not be aimed at sustaining the independent sector. That has made the Labour party somewhat cynical. How can a school continue to call itself independent when 40 per cent. of its pupils are there because of public funding through the assisted places scheme? The estimated cost of the scheme in the current financial year is £59 million. That is a substantial public contribution to the so-called independent sector. Clearly and inevitably many schools would be in great difficulty if that money were withdrawn from them. However, they need to prepare for a Labour Government withdrawing that money from them.
The fourth aim that the Government had in mind was to provide academic training for working-class young people. The implication was that the Government did not believe that such academic training could be provided in the maintained sector. Let us consider the criteria for what is academic. This year, the Government are adding another 52 schools to the list of schools to which the assisted places scheme will apply. That is partly to redress the regional imbalances. Of the 470 schools that made provisional offers of places on the scheme in 1981, its first year, more than 200 were discarded by the Department of Education and Science as unsuitable for such an academic scheme.
The 1989 newcomers to the list include several schools that were accepted by the DES then, but changed their minds about participating in the scheme. Clearly there are others that would have been acceptable had they applied. But the list includes a number that would almost certainly not have met the 1981 criteria. More than half the new schools have fewer than 400 pupils. How can the Government reassure anyone that those schools would be likely to offer the wide range of A-level subjects taught to viable groups in the way that the 1981 criteria required? Some lack any proven record of achievement in sending pupils forward to higher education. The Government have clearly abandoned the initial aims of the scheme as described to us.
I return to the subject of regional inequalities. The Government said that the scheme could be regarded as a national scholarship scheme for bright children from modest backgrounds. Indeed. the measure refers to the desirability of securing an equitable distribution of assisted places throughout the country and between boys and girls.
It does not need great brain power to appreciate that there is an uneven distribution nationally in the independent sector, particularly of schools that are called academically excellent, to which the scheme was supposed to relate. There is certainly an uneven distribution among those willing to offer substantial numbers of assisted places.
In 1988, for example, there were 464 new places available in Greater Manchester, 346 in the Liverpool and Birkenhead area and 225 in Bristol and Bath. By contrast, there were 70 in Nottingham, 55 in Leeds, 16 in Sheffield and none in Leicester. I give those figures simply to

demonstrate that the Government have failed, even on their own criteria, to ensure an equal distribution of resources.
As I have shown, the Government have failed to meet the intentions of which they spoke when they introduced the scheme in 1980. In addition, the costings have been startling. We are lectured daily by the Government on the need for economy. We are now being lectured about the need to be careful with public spending because, they say, high public spending is the cause of rocketing inflation.
If that is so, we must look carefully at the rising costs in the assisted places scheme. In 10 years, Government expenditure per pupil has increased by 275 per cent., which is certainly more than the rise in Government expenditure in the maintained sector. Indeed, if public spending in that sector had gone up by 275 per cent., we would probably not be suffering now from some of the problems that exist, but I will not embarrass the Government by dwelling on those problems.
It is clear from the figures that in the last four years 50 additional pupils have been covered by the scheme, for an extra £1,700,000. I appreciate the problems that the Government are facing in relation to inflation, but figures of that sort go beyond reality and sensibility.
Where is the public accountability in those rising costs? Who is in control of the expenditure? Who are, and where are, those publicly elected people who are determining fees? We are witnessing inefficiency. How can the Government guarantee value for money when they do not know what is happening and when they have no involvement in the setting of fees or in the development of the nature of schools? They have even opted out of any responsibility for the curriculum. We return to a point that we have talked about before. When the House was considering the Education Reform Bill, the Opposition were bemused that the Government could talk about a national curriculum yet exclude independent schools. Are they saying that people in independent schools are not part of the British nation?

Mr. Gerald Howarth: The hon. Lady does not understand how the system works. In the independent sector, parents vote with their feet and, if the curriculum is inadequate, they take their children away. In the maintained sector, until the reforms introduced by my right hon. Friend the Secretary of State, people had no choice. No choice is the Labour party's policy.

Ms. Armstrong: It is late at night, so I will forgive the hon. Gentleman for his inaccuracies. We are talking about public money. It is not a matter of parents making an automatic choice. All they can do is send their child to a school that is part of the assisted places scheme. Conservative Members know that parents do not move kids around as though they were pounds of butter and that they have consideration for their children, even if Conservative Members have not. Whatever the arguments about choice, this is public money and there should be public accountability. Those young people have the right to be treated as part of the national curriculum.
It is interesting that this legislation comes at the end of a week in which hon. Members and people outside the House have been much concerned about the Government's education policy and where it has taken children. People have talked about the massive problems


for children who cannot get a place in any school because there is no teacher. When will the Government take the education of all Britain's children seriously? When will they take their commitment to children in Tower Hamlets, who have no access to school because there is no teacher, as seriously as they take throwing money at the independent sector?
This week, there has been public criticism of the money that the Government have thrown at city technology colleges, a system which is meant to create different groups of children. The Government are doing that with public money. It is used to justify the Government's ideological dogma. The Government are denying opportunities to children and know that they cannot deliver the national curriculum to some children this September.

Dame Elaine Kellett-Bowman: rose——

Ms. Armstrong: They are making families pay for children—

Dame Elaine Kellett-Bowman: rose——

Mr. Nicholas Bennett: rose——

Mr. Deputy Speaker (Sir Paul Dean): Order. It is clear that the hon. Member for Durham, North-West (Ms. Armstrong) is not giving way.

Dame Elaine Kellett-Bowman: rose——

Ms. Armstrong: The hon. Lady was not present at the beginning of my speech. Therefore, I am not prepared to give way.

Dame Elaine Kellett-Bowman: On a point of order, Mr. Deputy Speaker.

Mr. Deputy Speaker: Order. It is clear that the hon. Member for Durham, North-West is not giving way.

Dame Elaine Kellett-Bowman: On a point of order, Mr. Deputy Speaker. I was not asking the hon. Lady to give way; I was raising a point of order. Is it in order for her to say that this is public money, when it is money raised from industry?

Mr. Deputy Speaker: That is a matter for debate, not a point of order.

Ms. Armstrong: The hon. Member for Lancaster (Dame E. Kellett-Bowman) should examine the amount of capital investment that the Department of Education and Science puts into city technology colleges.

Mr. Nicholas Bennett: When the hon. Lady was challenged by my hon. Friend the Member for Cannock and Burntwood (Mr. Howarth), who asked her whether Labour was in favour of the assisted places scheme, she did not answer the question. Will she not come clean and admit that the Labour party intends to get rid of choice altogether? The Labour party does not believe in the assisted places scheme. It has said that it will remove the charitable status of the independent sector, and that it will get rid of the city technology colleges and the grant-maintained schools. The Labour party proposes a statist education system with no choice at all, in which everyone has to be educated under the control of the state.

Why does she not come clean on that and admit that the consumerism in which the Labour party pretends to believe does not really exist?

Ms. Armstrong: I know that it is late. The hon. Gentleman understands what I am saying, although he pretends to misunderstand. I am in favour of choice, but I am as much in favour of choice for those kids in Tower Hamlets as I am for those who get into Cheltenham ladies college. Those children in Tower Hamlets, who are going into primary schools in which teachers have had no opportunity to update themselves in science, deserve choice as much as children whose parents decide that they want an independent education for them. I am not against people having choice, but I want choice for all people and not just some.

Mr. Michael Jack: Will the hon. Lady give way?

Ms. Armstrong: No. I promised the Minister that I would speak for only 15 minutes.

Mr. Jack: Will the hon. Lady give way on that point?

Ms. Armstrong: No, because the hon. Gentleman was not here at the beginning of the debate.
The Government are denying opportunity to the majority of children. They are demonstrating that they care about the few and that they believe that one can give a good education only to a few. We do not believe that, and we are not prepared to accept that. As a result, we will oppose the regulations.

Mr. Bob Dunn: I am delighted to take part in this short debate, and I welcome the Government's determination to continue to support and extend the assisted places scheme. I recollect that the last occasion on which I spoke as a Minister, on 5 July 1988, was in support of changes in the regulations on assisted places. I remember quoting the hon. Member for Blackburn (Mr. Straw) and I think that it is worth repeating his words today. He said in The Guardian on 23 March:
First, we must recognise that a nation of consumers enjoying relatively high living standards becomes literally much more choosy, much more interested in choice and variety.
He said that then, and as far as I know, for he is an honourable man, he has not rescinded that comment or changed the interpretation I chose to give those words at the time.
It was clear from the speech of the hon. Member for Durham, North-West (Ms. Armstrong)—and I welcomed her comments about her distinguished predecessor, thereby reminding us of her commitment to the hereditary principle—that we have been debating over some eight years this scheme which gives many young people from disadvantaged backgrounds an opportunity to seek and benefit from an education in good schools in the independent sector.
When the education spokesmen of the Labour party, starting with the hon. Member for Blackburn and going on to the hon. Members for Durham, North-West and for Oxford, East (Mr. Smith), talk about the needs of working class children, I want to reach for my political gun. There they sit, products of the British middle class, trying to dictate to the House what they believe are the needs and


aspirations of working class children. The truth is that the Labour party has always regarded members of the alleged working class as political pawns in the sense of being members of the tied cottage culture. When we decide to extend the chance to create a ladder of opportunity, for children who in themselves——

Mr. Frank Haynes: Will the hon. Gentleman give way?

Mr. Dunn: I will give way in time, but not in the middle of my best point. I will determine the debate when I have the floor. I certainly do not intend to give way to the middle class Members of Parliament sitting on the Opposition Front Bench who tell the House what needs to be done for children who, until now, had access only to that neighbourhood school that their local authority had dictated that they should attend.
The hon. Member for Durham, North-West asked why the Conservative party believed in the principle of the assisted places scheme.

Mr. Haynes: Will the hon. Gentleman give way?

Mr. Dunn: I will give way in time, but the hon. Gentleman must learn to be patient. Patience is a virtue seldom exercised by the hon. Member for Ashfield (Mr. Haynes) and, in the dying time that he is in the House, he should learn it. He has become an institute—the parliamentary foghorn of the Labour party—but he is now to hand in his bell and retire to Derbyshire, or some place like that.
The hon. Member for Durham, North-West asked why we were in favour of the scheme. The answer is simply because it provides a ladder of opportunity that was destroyed by the consensus of both Governments in the past, which destroyed many excellent schools in pursuit of the peculiar notion of egalitarianism.
The hon. Member for Ashfield has been extremely virtuous, so I shall now give way to him, but let me remind him that I am not deaf.

Mr. Haynes: Earlier today I told Mr. Speaker that he called me last in business questions because I am the most patient of hon. Members. I have a thick skin, and the hon. Gentleman can throw whatever he likes at me. He spoke about the middle class Members on the Opposition Front Bench, but I was born in poverty and worked for 35 years in the pit before I came to this place. He can put that in his pipe and smoke it.

Mr. Dunn: As I understand it, the hon. Gentleman is not a Labour party spokesman on education. I was referring to those who exercise that peculiar privilege at the moment.

Dame Elaine Kellett-Bowman: Had the hon. Member for Ashfield (Mr. Haynes) lived in Lancaster, whatever background he came from, he could have gone to the Lancaster Royal grammar school, had he the ability, which many of my hon. Friends have. The Labour party destroyed the chances of people like the hon. Gentleman.

Mr. Dunn: There is no doubt that my hon. Friend has made an important point.
I was speaking about the logic behind setting up the scheme in 1981. I welcome the extension of choice, and I welcome the decision of my right hon. Friend the Secretary of State to extend into the list a further 52 schools. I also

welcome regulation 18 in part V, which deals with the publication of information. I hope that in time the Government will give us some idea of how those children who started off in the scheme in the early 1980s and who must now be entering higher and continuing education have been performing, given the good start that they received.
The point of the debate is simply to remind the House that the scheme exists and that the scheme is working. Of course, I believe that we should do more to make it more accessible to many more children in other parts of the country. I welcome the support of the hon. Member for Durham, North-West, implicit in what she said about the denial of places in the city of Leicester. If the hon. Lady asks us for assisted places in Leicester, who are we to deny that opportunity to the people of Leicester?
I will say to the hon. Lady that it was a good try, but that she has remained wholly unconvincing in the case that she has set out. She has continued to be an ideologue I—think that it is an insult to be called an ideologue—in what she seeks to achieve. Self-congratulation is the prerogative of the Labour party, and every July when we debate the assisted places regulations Labour Members prove that they know nothing about working class aspirations and that they care even less.

Mr. Simon Hughes: The hon. Member for Dartford (Mr. Dunn) was on his best form, berating the Labour party from a position of small influence, just as he used to do as a former member of Southwark council—a council of 64 on which the Tories have but seven members.
I want to say two main things about the regulations, as the latest in a succession of my hon. Friends who have spoken in these debates since 1980. The first is that the Government's scheme is unprincipled and the second is that it is inconsistent.
The assisted places scheme is unprincipled because it denies the proper priorities that there should be in the education of our young people.

Mr. Nicholas Bennett: What about John Stuart Mill?

Mr. Hughes: John Stuart Mill would be completely at one with my argument.

Mr. Nicholas Bennett: No, he would not.

Mr. Hughes: Yes, he would. I shall deal with that point and a point made earlier by the hon. Member for Cannock and Burntwood (Mr. Howarth) in a moment.
The Conservative party's analysis is flawed for one obvious reason. The lack of principle manifests itself in the evidence that it is a greater Government priority to spend public money on supporting a few—in a system in which it is hoped they will become privileged—than it is to spend more on the public sector, in which lack of funding results in many children's education not moving from the bottom rung. [Interruption.] I stress—to the hon. Member for Lancaster (Dame E. Kellett-Bowman) and others—that those of us in whose constituencies education is most in crisis as a result of Government policy and failure to fund see the results clearly. The money is not being spent where it should be spent—to assist needy schools, children and


teachers. If it were not spent on the assisted places scheme, there might be more money available out of the public purse to help more people.

Dame Elaine Kellett-Bowman: Will the hon. Gentleman give way?

Mr. Hughes: I shall give way in a second. The hon. Lady's belated arrival was compounded by——

Dame Elaine Kellett-Bowman: I arrived later than I intended.

Mr. Hughes: Yes, I know. The hon. Lady's late arrival was compounded by the ignorance displayed in her intervention.
On CTCs, the Government declared that they wished the majority of money to come from industry and the minority from the Department or the Treasury. That has not happened. The Government did not find more than a few people in industry who were prepared to fund CTCs.

Dame Elaine Kellett-Bowman: Oh yes, they did.

Mr. Hughes: No, what I have said is factually correct, and Ministers would be unable to deny it.
The majority of money has come from the Department of Education and Science—80 per cent. to 20 per cent., the exact opposite of what was the original Government plan. There are two reasons for that. First, much of industry—I have spoken to several people—is not supportive of what they see as a divisive scheme. Secondly, this latest Government initiative that seeks to fund other things rather than the general education system is perceived to be what it is—a tokenist attempt, which, in its tokenism, deprives others of considerable resources where the greater priorities are and the greater money should be spent.

Dame Elaine Kellett-Bowman: Having been a social worker in the east end of London, I was well aware of the ability of youngsters who really tried in those areas to get away from their schools and have wider educational opportunities in grammar schools. It is a tragedy that those youngsters are now denied that chance. I believe firmly that the assisted places scheme is giving back to those youngsters from disadvantaged homes the chance of which the Labour party, with the connivance of the Liberal party, deprived them.

Mr. Hughes: Last night I was at a farewell party for the head teacher of a primary school in my constituency, where the children speak at home 28 different mother languages. One of the former pupils of that primary school is now at Cambridge, having gone entirely through the county sector, and is expected to get a first-class honours science degree. There is no reason why to have excellence in education one has to perpetuate a system which divided children at 11 years on the basis of a single test which was shown academically to be often inaccurate in assessing people's ability, and cast children into two groups—the sheep and the goats—for good, to the great detriment of many of those who went into the secondary modern as opposed to the grammar school sector.
It is also inconsistent, this year above all, for Government Ministers to argue in favour of a continuation of the assisted places scheme. It is inconsistent because, if the Government are to be believed,

their education policy over the past 10 years has been successful—by their argument, the standards have gone up and good reforms have been made. If the county system is so much better now than it was 10 years ago, so much less is there a case for paying people to leave it to go into the independent sector. Even less so for the reason that this year, as a result of the Education Reform Act 1988, we will see the national curriculum in place. [HON. MEMBERS: "Hear, hear".] I agree entirely—hear, hear—and I am supportive of the objectives of a national curriculum. However, I hope that the Minister of State at the Home Office who assented to the support for the national curriculum will agree with the hon. Member for Durham, North-West (Ms. Armstrong) and me that it is entirely inconsistent that it should not also apply to certain schools—those very schools to which the Government fund children to go. The private sector, which is free from any national curriculum and which can sometimes teach very poorly, is funded by the taxpayer and the public purse to ensure that certain children get on to what clearly is a ladder, not necessarily of opportunity for academic excellence, but of opportunity to become more privileged because of the result that the private education system often produces.
The inconsistency is that in the year when we have the introduction of the national curriculum, instead of saying, "Our education reforms have been so good and we now have the national curriculum which will be so much better, so we do not need the assisted places scheme any more", the Government are saying, "We still need and we still want to encourage more and more people to leave the public sector and to go into the private sector of education, funded by the public purse".
The hon. Member for Cannock and Burntwood said that the merit of the market place was that the parents, in choosing independent schools, vote with their feet. They do not—they vote with their wallets. The difference is that many people do not have anything in their wallets with which to vote. By picking just a few of the many hundreds of thousands of children whose parents do not have anything in their wallets, one is not changing the fundamental inequality that exists. One is not changing that inequality if some people can buy their way into the private sector and if the private sector is supported by a few others who have their places provided out of public funds when that is not an option for the majority of people in this country.
I am not in favour of a monopoly of county or state education; I am in favour of independent schools—[HON. MEMBERS: "Oh."]—but I am not in favour of independent fee-paying schools in which some people have the right to buy their way into a position of advantage for their child when another child has no such advantage.

Mr. Gerald Howarth: The hon. Gentleman must realise that the downward pressure on fees in the independent sector is due to the fact that parents do not have unlimited wallets. If the hon. Gentleman took the time to study the parents who send their children to independent schools, he would find that they are not often "rich"; they are simply parents who are making the most enormous sacrifices to send their children to such schools because they believe them to be better. The fact that it is their money—and that they are careful about how they spend their money—means that they do vote with their feet. If a school is inadequate they will not send their child to that school,


they will withdraw the child and send him or her somewhere else. It is wholly untrue that independent schools are acting in a vacuum; they are subject to the schools inspectorate like the whole of the maintained sector, so there is some kind of supervision.

Mr. Simon Hughes: Of course, there is some kind of supervision. However, I am very aware that, as the hon. Gentleman well knows, it is not the same kind of supervision. I am also aware of the pattern of and the trends in the people who send their children to private schools. In constituencies such as mine where, in general, the secondary education provided by the local authority is poor, some parents make great sacrifices to buy their children out of that system—and I understand that. Often those parents do so because they think that it will give their children an advantage. Sometimes it does, but sometimes it does not. However, those parents do not do so necessarily or normally because the private system provides better educational standards, but because they believe that, all things taken together, it will give their children an advantage at the end of their schooling.
A far better system would be to ensure that there is indeed choice, but choice that is not determined by whether one can pay to exercise it and that is not precluded from those who cannot pay but still wish to exercise it, and choice across a whole range of options in which money is not the object.
I had hoped that when introducing the debate the Minister would say how the assisted places scheme was achieving the objectives that he and his predecessors had set for it. He explained the changes in the regulations, but, as the hon. Member for Durham, North-West said at the beginning of her speech, over the eight or nine years that the system has been operating, there is no evidence that it has achieved the objectives originally set for it. The only evidence that exists is that the Government have continued to spend a proportion of taxpayers' money when increasingly over that time the greater priorities have been elsewhere. When a Government do not have the courage to put their money where their priorities should be, it is a sad day for education.

Mr. Butcher: First, I give my hon. Friend the Member for Dartford (Mr. Dunn) the assurance that we shall be looking at the outcome of the scheme. It is right that we should follow up and examine the achievements of those who pass through the assisted places scheme as they move into higher education or careers.
The speech of the hon. Member for Southwark and Bermondsey (Mr. Hughes) was pretty mixed up. There was a time when the Liberal party was committed to pluralism and believed in choice, but the moment the hon. Gentleman was tested on that point, he implied that he believed in independent schools, but not in fee-paying independent schools. If that is his position, I assume that he really means that he likes independent schools which have free places. Therefore, can I assume that the hon. Gentleman is in favour of grant-maintained schools?

Mr. Simon Hughes: There should be plurality and diversity in education in all sorts of schools, but the criteria for getting there should not be the ability to pay.

Mr. Butcher: That is, I think, an interesting commitment from the Liberal party to grant-maintained

schools, and I am grateful for that. If the hon. Gentleman is to stay true to his logic, I hope that he will declare his commitment to city technology colleges. I understand that he runs with both the hare and the hounds in his constituency on that matter.

Mr. Simon Hughes: I think that the hon. Gentleman knows that I am a governor of a school in Southwark that is going through the process of deciding whether it should be a CTC. I voted against the proposal because for the Government to refuse that school £1·5 million to be relocated and rebuilt on a different site and then to bribe the school by offering it £10 million to become a CTC was completely inappropriate and against the wishes of the community, the parents and all locally-elected representatives. I do not believe in that sort of selective pressure on the local education system.

Mr. Butcher: The Liberal party is clearly all over the place and that explains why it is no longer concerned about policy formation and is descending into the sort of agitprop irrelevancies which now pose as policy in that party.

Mr. Derek Fatchett: Let me provide the Minister with some information because he did not take part in the debates last year on the Education Reform Bill and he will have missed the strong and fundamental opposition to grant-maintained schools offered by the then education spokesperson for what was then the Liberal party who is now the leader of the Social and Liberal Democrats. When the hon. Member for Southwark and Bermondsey (Mr. Hughes) says that the SLD believes in pluralism, he really means that he has one policy and his leader has another.

Mr. Butcher: I am grateful to the hon. Gentleman. It is at this point that the cross-party consensus comes into question.
The hon. Member for Durham, North-West (Ms. Armstrong) began by talking about the social mix in independent schools which take pupils under the approved places scheme. I thought that she was leaning towards the proposition that in order to improve the social mix in her terms, and even in the Government's terms, to get more young people from low-income families into those schools, we should increase the number of assisted places available. If she is true to her logic she should support us in increasing the number of places and we shall then only have to agree by how many the current number of 35,000 places must be increased. Then we would get the sort of social mix for which I thought that she was arguing.
But matters get much worse. We are fortunate tonight in having all the members of the Labour party's education team on parade on the Opposition Front Bench. The hon. Member for Oxford, East (Mr. Smith) went to Reading grammar school, a selective school. The hon. Member for Leeds, Central (Mr. Fatchett) went to Lincoln school, a selective school in his time. The hon. Member for Durham, North-West is the only one, consistent with her principles, who went to a non-selective school. The hon. Member for Blackburn (Mr. Straw) attended Brentwood school, now in the assisted places scheme. So far so good. In his time it was a direct grant school, which he attended from 1957 to 1964. I wish that I had had that advantage. I went to a common or garden grammar school.

Mr. Jack Straw: It shows.

Mr. Butcher: Under the direct grant arrangements a capitation fee was paid by the DES on behalf of every pupil. Therefore, the hon. Gentleman, laugh as he may at the moment, was the beneficiary of state assistance to attend a selective school. Why is it that tonight he and his privileged team of colleagues, who are perched on the Opposition Front Bench like starlings, wish to say to Brentwood school, the old school of the hon. Member for Blackburn, "You can't do it under the APS"? Why is the hon. Gentleman saying that parents on low incomes should not have the same opportunities that his parents had? It seems that they are not to have that choice if he has his way. If he is to be consistent with his philosophy, he should support the Government.

Mr. Straw: I am grateful to the hon. Gentleman for informing the House of what could be read in any of the reference works of the past 15 years. I am not in the least ashamed of where my parents happened to arrange for me to go to school. None of us is responsible for where we went to school. Instead we are responsible for where our children go to school. When we went to school, there were no comprehensive schools. All schools were selective. As the Minister wishes to trade family histories, he should be made aware that my youngest sister failed the 11-plus. It was only because comprehensive education was available in the adjoining education division that she had the chance to take advantage of higher education. The Labour party is concerned that there should be real choice for everyone and not merely for a privileged few. That is why we have pushed for the comprehensive principle throughout the country.

Mr. Butcher: The hon. Gentleman has done nothing to persuade me or, I think, the House that the inconsistency embodied in his own career does not remain strong. The privileged bunch on the Opposition Front Bench is saying that it will deny opportunities to children of poor and less well-off families through the APS. It is a scheme which benefited one of the bunch directly. Two more of its members enjoyed privilege with state funding in a selective system. I find its position difficult to contemplate.
Why do we help children whose parents are on low incomes? I shall use some real examples. The Labour party has been pretty good of late—let us pay it the compliment—of taking individual cases and making general points from them. I shall take the opportunity of taking some individual cases and making general points from them. I shall present real examples of pupils who have done well against the odds through the APS. There was the girl suffering from cystic fibrosis whose widowed mother put her through an APS school in Surrey. Last year, she left that school with one A and two B grades at A-level and she is now studying law at university.

Ms. Armstrong: Will the Minister give way?

Mr. Butcher: Let me finish.
There was the Coventry boy whose four A grades and one B at A-level won him a place at Oxford, where he is now reading mathematics. I am sure that his father, an unemployed labourer, is rightly proud. There was the London assisted pupil who achieved two As and a C at A-level last year. Both parents are blind. I am sure that with that handicap bringing up children can be a monumental struggle. If the assisted place gave those parents the reassurance that their child was being educated

according to their wishes, who would begrudge them that? We believe that they should have that choice. If the local neighbourhood comprehensive school is not to their choice, they should have the opportunity to send their child elsewhere.

Ms. Armstrong: Is the Minister really saying that that opportunity should be available only to those on the assisted places scheme? Is he saying that such an opportunity could not be made available in the local comprehensive? Is he saying that he is not committed to ensuring that that opportunity is available in every comprehensive school in the country, for every child?

Mr. Butcher: No, I am not saying any of those things. The hon. Lady has just dug herself a very deep hole. If she examines the Education Reform Act 1988, which she opposed root and branch, she will find that a theme runs through it. It will be seen that in the case both of grant-maintained schools and CTCs the Government will be giving the independent sector real competition and a real run for its money—because we have expectations of the state's free system that are the same as those that we have in respect of the independent system. The Government are giving real choice in those terms.
The examples I gave related to people who opted for a certain ethos. We say that that same ethos can come through in our state systems, through the grant-maintained schools and through the CTCs. We are the friends of the underprivileged in that regard.

Mr. Dunn: Does my hon. Friend agree that the Opposition's contribution is quite bizarre? They are saying that because something cannot be available to all, it should not be available to anyone. Presumably the same applies, in the Opposition's view, to those people who cannot afford to buy their own house—and the Opposition would argue also that because some people cannot afford to buy a car, no one should own a car. That is the logic of the politics of envy.

Mr. Butcher: My hon. Friend the Whip advised me not to prolong the debate, and in order to put Labour out of its misery we should not do so. We have been given enough material tonight to keep us going until the next general election.
Labour has been exposed as the party not of equality and opportunity but of dull uniformity and mediocrity. That is Labour's game. It believes in equality—full stop. We believe in true equality of opportunity. I shall sit down and challenge the Opposition to undertake a little research. They have not done much, and they ought to do more.
We know which schools the members of the Shadow Cabinet attended. My estimate is that one third of them attended independent schools. I say to the hon. Member for Bolsover (Mr. Skinner) that they are a tough bunch, are they not? They are a privileged lot. One third of their number attended independent schools, and another third attended selective schools—and only one third of them shared the hon. Lady's lonely new tradition of attending a comprehensive school.

Ms. Armstrong: I am amazed at the Minister's ignorance of educational history. It took Labour Governments to introduce comprehensive education. I confess to attending a selective school after I took the 11 plus. My predecessor as Member of Parliament for my


constituency was chairman of the education committee and took that school out of selectivity and made it a comprehensive school, which was an enlightening and uplifting experience for me.
The Minister should know and understand that it took legislation in this House to move towards non-selective education, and that his right hon. Friend the Prime Minister, when Education Secretary, took more schools out of selection than any previous Secretary of State for Education.

Mr. Butcher: I have had quite enough fun tonight, and I commend the regulations to the House.

Question put:—

The House divided: Ayes 93, Noes 17.

Division No. 314]
[11.14 pm


AYES


Amess, David
Couchman, James


Amos, Alan
Currie, Mrs Edwina


Arbuthnot, James
Davies, Q. (Stamf'd &amp; Spald'g)


Arnold, Jacques (Gravesham)
Day, Stephen


Aspinwall, Jack
Dover, Den


Baldry, Tony
Dunn, Bob


Bellingham, Henry
Durant, Tony


Bennett, Nicholas (Pembroke)
Fallon, Michael


Boswell, Tim
Forman, Nigel


Bowden, A (Brighton K'pto'n)
Fox, Sir Marcus


Bowis, John
Garel-Jones, Tristan


Burt, Alistair
Gill, Christopher


Butcher, John
Greenway, John (Ryedale)


Butterfill, John
Gregory, Conal


Carlisle, Kenneth (Lincoln)
Hampson, Dr Keith


Carrington, Matthew
Hargreaves, Ken (Hyndburn)


Cash, William
Harris, David


Chalker, Rt Hon Mrs Lynda
Hawkins, Christopher


Chapman, Sydney
Hind, Kenneth


Chope, Christopher
Howarth, Alan (Strat'd-on-A)


Clarke, Rt Hon K. (Rushcliffe)
Howarth, G. (Cannock &amp; B'wd)


Coombs, Simon (Swindon)
Hunt, David (Wirral W)


Cope, Rt Hon John
Irvine, Michael





Jack, Michael
Spicer, Sir Jim (Dorset W)


Johnson Smith, Sir Geoffrey
Spicer, Michael (S Worcs)


Kellett-Bowman, Dame Elaine
Steen, Anthony


King, Roger (B'ham N'thfield)
Stern, Michael


Knapman, Roger
Stevens, Lewis


Knowles, Michael
Stradling Thomas, Sir John


Lawrence, Ivan
Summerson, Hugo


Lightbown, David
Taylor, Teddy (S'end E)


Lilley, Peter
Thompson, Patrick (Norwich N)


Lloyd, Peter (Fareham)
Tracey, Richard


Lord, Michael
Twinn, Dr Ian


Maclean, David
Vaughan, Sir Gerard


Mans, Keith
Waddington, Rt Hon David


Miller, Sir Hal
Waller, Gary


Mitchell, Andrew (Gedling)
Wardle, Charles (Bexhill)


Mitchell, Sir David
Warren, Kenneth


Neubert, Michael
Widdecombe, Ann


Nicholls, Patrick
Wilkinson, John


Norris, Steve
Wilshire, David


Patten, John (Oxford W)
Winterton, Nicholas


Peacock, Mrs Elizabeth
Wood, Timothy


Rumbold, Mrs Angela



Shaw, David (Dover)
Tellers for the Ayes:


Shelton, Sir William
Mr. David Heathcote-Amory and Mr. John M. Taylor.


Shephard, Mrs G. (Norfolk SW)



Shepherd, Colin (Hereford)





NOES


Armstrong, Hilary
McWilliam, John


Barnes, Harry (Derbyshire NE)
Pike, Peter L.


Bruce, Malcolm (Gordon)
Smith, Andrew (Oxford E)


Cunliffe, Lawrence
Straw, Jack


Fatchett, Derek
Wallace, James


Foster, Derek
Wise, Mrs Audrey


Hood, Jimmy



Howells, Geraint
Tellers for the Noes:


Hughes, Simon (Southwark)
Mr. Frank Haynes and Mr. Dennis Skinner.


Jones, Barry (Alyn &amp; Deeside)



Kinnock, Rt Hon Neil

Question accordingly agreed to.

Resolved
That the draft Education (Assisted Placed) Regulations 1989, which were laid before this House on 26th June, be approved.

Orders of the Day — Mr. Jens Soering

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Fallon.]

Mr. Teddy Taylor: I wish to raise an important constitutional issue and, as is the case with so many important constitutional issues—[Interruption.]

Mr. Deputy Speaker (Sir Paul Dean): Order. Will hon. Members who are not staying for the Adjournment debate please leave the Chamber quietly?

Mr. Taylor: The matter that I raise tonight is important and fundamental for British sovereignty. Sadly, many of these issues arise late at night when few people notice them. It is, however, important that I get the facts of the case on the record.
I am grateful for this opportunity to raise the implications of an instruction from the European Court in Strasbourg that the United Kingdom should not fulfil its extradition arrangements with the United States and return Mr. Jens Soering to Virginia to face charges of his involvement in a horrific double murder.
The decision of the court appears to involve an astonishing extension of the powers of the court, a major insult to the free democracy of the United States and dangerous implications for our national security and for the rights of Parliament. It is obvious that the European Court in Strasbourg has been extending its power, as is invariably the case with European institutions. The scope of its present jurisdiction seems to go far beyond the tight and specific articles which were laid down in the convention of 1953.
In this case, hon. Members will recall that, because the original signatories were determined that the court should have no power to interfere with capital punishment authorised by national Parliaments, article 2(1) of the convention stated:
No-one shall be deprived of his life intentionally, save in the execution of a sentence of a court following his conviction of a crime for which the penalty is provided by law.
Nothing could be clearer. If it was a question of capital punishment, the court could not interfere. But despite that clear statement and guidance, the court has instructed Britain not to extradite a person who was to face a charge of involvement in one of the most brutal, evil and monstrous murders ever committed.
The facts of the murder are abundantly clear. Jens Soering is accused of slashing Derek Hayson, aged 72, and his wife, Nancy, in the throat in March 1985 and then of stabbing them repeatedly in their Virginia home in circumstances with black magic overtones. The walls of that elderly man's house were daubed with blood and the number 666, which is allegedly the sign of the devil, was gouged out of the floorboards. Bloody footprints suggested that the alleged killers danced in the couples' blood.
After the killings, M r. Soering and the couple's daughter, Elizabeth, left America and arrived in Britain in January 1986 with false documents. They were arrested and gaoled for 12 months at Kingston Crown court. Police found wigs, false moustaches and bogus driving licences in their bedsit.
After her sentence, Miss Hayson returned to Virginia, where she was sentenced to 90 years' imprisonment as an accessory to a double murder. She did not fight extradition but simply went back to America to face the charge.
However, rather than face similar charges, Mr. Soering has been experiencing the judicial delights of the European Court in Strasbourg and, in consequence of its astonishing generosity of spirit, can presumably now remain in Britain or elsewhere in Europe for the rest of his life and not be required to return to the United States to face the charge of bloody murder.
The British courts require him to return to the United States of America, although, for reasons which I hope that the Home Secretary will explain, it was made clear that the United Kingdom did not wish Mr. Soering to face capital punishment in the United States of America if he were found guilty. I hope that the Minister will say why that was said. Capital punishment has always been a free vote issue in this House and I do not believe that there is any Government policy to communicate on such matters.
Do the Government intend to accept the European Court's decision? Are they worried about what seems to be a huge extension of the powers seized by the court? The court has argued that the time taken in the United States of America for appeals could be so lengthy that it would inflict unreasonable degradation and inhumanity on Mr. Soering if he were found guilty.
The Government have the power, if they wish to use it, to tell the European Court to jump in the lake. It is not part of the Common Market and it is not the European Court of Justice, but the European Court of Human Rights. When the court made another remarkable decision last year on the rights of alleged terrorists to appear before a judge at an early stage in the tension, the Home Secretary made it clear in Parliament on 6 December, as reported in column 211 of Hansard, that we could decide to derogate under article 15. More fundamentally, he suggested that we could decide to withdraw from the court's jurisdiction.
The Home Secretary should be aware that, if he goes along with the court's decision, he will inflict a massive injury and insult on the United States of America, which is a democratic ally which never fails to help Britain in the battles against international crime and terrorism. It would also be a moral crime inflicted on the relatives of the murdered elderly couple to fail to send to the courts in Virginia a person accused of the killings.
What will the Government do? The European Court judgment also affects the rights of Parliament. If Parliament decided in future to reintroduce capital punishment for murder or terrorism the decision would be an ineffective joke, unless we could satisfy the European Court of the acceptability of our appeal mechanism.
There is a rising tide of concern in the Conservative party, in Parliament and in Britain generally about the extent to which non-elected European bodies are seizing the rights of our elected Parliament, elected Government and respected courts of law. At some stage we must make a stand. I believe that the time has come in the shameful case of the Strasbourg decision on Jens Soering.
What will happen to Mr. Soering? Can he stay in Britain for the rest of his life and, presumably, with our European Community arrangements, go to Germany or anywhere and live on social security for the rest of his life, if he wants, and no doubt be the first of many? What are the rights of Parliament'? What is our attitude to the European Court if it constantly extends its powers? The


Minister must be aware that the European Court of Justice is extending its powers as well as the European Court in Strasbourg.
I can think of no issue more serious for our constitution or relations with our friends in the United States of America. I hope that the Minister will bear in mind the fact that they help us enormously, for example, to deal with terrorism and the IRA. This is a serious case. I know the Minister's conscientious attitude to justice and of the great work that he does at the Home Office. I hope that he will give some hope to those who are acutely worried by this dreadful case.

The Minister of State, Home Office (Mr. John Patten): I hope that I can give some hope to my hon. Friend the Member for Southend, East (Mr. Taylor) and to others who are worried about this case. I congratulate him on bringing it to the attention of the House.
I listened extremely carefully and take my hon. Friend's comments seriously. He described the dreadful murders so graphically that they bear no repetition by me, and he spoke of the constitutional powers of courts outside the United Kingdom. My hon. Friend and I take the constitutional issue seriously, as I hope the whole House does, as it affects the powers of this place. We must keep it in mind. My hon. Friend does the House a service by keeping it before us.
I hope that I shall be able to reply directly to every question that my hon. Friend asked, but if he feels that I have missed anything, I shall be only too pleased to give way to him at the end of my speech. I shall not trouble the House further with the detailed background to the case except to say that one person involved returned of her own free will to the United States and is now serving a 90-year gaol term in the state of Virginia.
The background is contained in the judgment of the European Court of Human Rights, a copy of which is in the Library of the House. The salient facts should, however, be brought to the House's attention. Soering's extradition was sought, in 1986, by the United States authorities on a capital murder charge. Soering is a German national. The German authorities have also sought his extradition as they have jurisdiction over offences committed by their nationals abroad. They have rather more jurisdiction than United Kingdom courts, although our courts have such powers in the case of murder and one or two other offences.
My right hon. Friend the Home Secretary, having received requests from the United States and a request from the Government of the Federal Republic of Germany, has taken the view that the proper course is to continue with the United States extradition request although the German request is still extant. If he so decides, my right hon. Friend can at any time act on that request.
My hon. Friend is concerned to know why we had any inhibitions about returning someone, provided that the facts of the case were clear and justice was done, to a jurisdiction where a person might face a capital sentence. The extradition treaty between the United Kingdom and the United States of America provides for a discretion on surrender if the relevant offence is punishable by death under the relevant United States law. For better or for worse—I dare say that my hon. Friend feels that it is for

the worse—that is written into United States treaty. It also provides for the giving of assurances satisfactory to the requested party that the death penalty will not he carried out.
In this case, the Virginian authorities gave an undertaking that, if Soering were convicted of murder, a representation would be made in the name of the United Kingdom to the judge at the time of sentencing that it was the wish of the United Kingdom that the death penalty should not be imposed or carried out. What has happened since then is a process of appeal.
Soering sought first to challenge the decision to extradite him to America. He did that in the domestic courts in Britain and then by application to the European Commission of Human Rights. Before the Commission, Soering's principal contention was that, if he was surrendered to the United States, there was serious reason to believe that he would be subjected to inhuman or degrading treatment or punishment in contravention of article 3 of the convention. This would arise, he suggested, from the exceptional and inordinate delay before carrying out the death penalty in Virginia. In a number of cases in that state's jurisdiction, delay has been substantial—five to eight years.
The Government acceded to the request of the President of the Commission not to remove Soering while it considered his application on this ground.
What happened is now history and is in the judgment, which is in the Library. The Commission decided by a narrow margin that the extradition of Soering to the United States of America would not give rise to a breach of the convention. The case was then referred to the court by the Commission and subsequently by the United Kingdom Government and the Government of the Federal Republic of Germany. The judgment of the court was delivered on 7 July. The court held unanimously that Soering's extradition would violate article 3 of the convention.
It is worth spending a brief moment on the court's judgment. In reaching its conclusion, the court was at pains to make it clear that the death penalty as such was not contrary to the convention—the court said that in its judgment—nor was it seeking to apply the convention to a state that was not a party to the convention. The court explicitly acknowledged the democractic character of the Virginian legal system and stressed that Virginian trial, sentencing and appeal procedures were beyond doubt. The machinery of justice to which Soering would be subject in the United States was in itself neither arbitrary nor unreasonable. Additionally, and happily from the point of view of my right hon. Friend the Home Secretary, my right hon. and learned Friend the Attorney-General and myself, the court acknowledged the good faith of the United Kingdom Government in their approach to this case.
The court considered, however, that the nature of the assurance received in this case were open to doubt. The court found that it was not open to it to conclude that there were "no substantial grounds" for believing that the applicant faced a real risk of a death sentence. That led the court to consider what has become known as the "Death row phenomenon". It accepted that some delay between sentence and its execution was inevitable—up to 90 days when we had the capital sentence—but it had regard to the very long period likely to be spent awaiting execution in Virginia, which could be five to eight years, with the ever-present and mounting anguish of awaiting execution.


The court took account also of Soering's personal circumstances—his age and mental state at the time of the offence and so on.
In the light of this, it concluded that there would be a real risk of exposing him to treatment going beyond the threshold set by article 3. A further consideration was that in this particular instance the legitimate purpose of extradition could be achieved by another means which would not involve suffering of such intensity and duration—his return to Germany for trial.
Since receipt of the judgment earlier this month, the Government have been seriously considering its implications and the courses of action that are now open to us. While that process is continuing, I hope that my hon. Friend will appreciate why I cannot predict what the outcome of this case will be.
I want to respond, however, to the specific points raised by my hon. Friend. He suggested in particular that the United Kingdom should simply ignore the views of the European Court of Human Rights—tell it to "jump in the lake" was his graphic phrase. But we are talking of international obligations binding upon the United Kingdom. Each of the parties to the European convention of human rights has undertaken to abide by the decision of the court in any case to which they are parties. The House will recall that this country took a leading role in the evolution of the convention, and successive Governments have been scrupulous in complying with the judgments of the court.
My hon. Friend also referred implicity to a recent case in which the United Kingdom felt obliged to derogate from the convention, following a judgment of the court. I want to point out why derogation was correct in that case and would not be correct in the case that my hon. Friend has raised. The circumstances were very different. That case concerned detention in Northern Ireland under the Prevention of Terrorism Act 1974. In that case, we derogated from our obligations under article 5 of the convention. Derogation in respect of particular articles of the convention is expressly provided for in article 15, which states:
in time of war or other public emergency threatening the life of the nation.
We believe that there is an emergency in the Northern Ireland case. That is not the position in the case we are discussing tonight.
I must also point out to my hon. Friend that no derogation is permitted from certain articles of the convention, including article 3 on inhuman or degrading treatment or punishment. Under the convention, we cannot derogate in the same way as we are able to derogate in the case to which my hon. Friend referred.
Having made those points and answered those questions, I want to underline certain key issues raised by the case. The first is the importance that the United Kingdom attaches to its extradition agreements. They are a major factor in our responses to serious crime and we are committed to the principle of co-operation between jurisdictions. We welcome the strong and close co-operation that we have with the United States, to which my hon. Friend referred so warmly and which will be greatly appreciated by the United States Goverment who,

I am sure, will pay attention to our proceedings tonight. A key objective throughout our handling of these issues has been to maintain the integrity and effectiveness of our extradition arrangements with the other countries concerned. That is clearly in our best interests.
Secondly, I want to stress that the judgment of the European Court of Human Rights centred on the fact that Soering was at risk of experiencing the "Death row phenomenon" if he were to be extradited to the United States in the present circumstances. That is to say, it is extradition while the threat of a death sentence remains that led the court to declare a breach of the convention. I ask my hon. Friend to reflect on what I am about to say. It follows from that that if the threat of a death sentence were to be removed, no question of a breach of the convention would arise from extradition to the United States.
Thirdly, I can tell my hon. Friend and the House tonight that Her Majesty's Government remain committed to ensuring that Soering should stand trial for the offences that have been alleged against him. If the threat of a death sentence in the United States cannot be removed, there remains the clear option of returning Soering to stand trial in Germany—rather than maintaining his freedom in the United Kingdom—in the way in which my hon. Friend thought might have been possible under certain circumstances.
I assure my hon. Friend, whom I hold in great respect because of his strong and passionate interest in law and order and the constitutional integrity of the kingdom, that we have not been idle since receiving the Strasbourg judgment three weeks ago and we have not ignored the importance of this case to our relationship with the United States and the Federal Republic, and to the integrity and good working of our extradition arrangements with those two countries. We have been in discussions with the American and German Governments since the judgment, although the House will appreciate why it would not be appropriate for me to go into details of those exchanges tonight.
I hope that what I have said will convince my hon. Friend that we are treating this case as one of the utmost seriousness. We are faced with allegations of very serious offences and our objective has been to honour our international obligations and to ensure that the case comes to trial.

Mr. Teddy Taylor: With the leave of the House. I am grateful to my hon. Friend the Minister for the serious reply that he has given to my questions. I am delighted to hear that it is his intention that Soering should face trial. In view of the importance of the relations between Britain and the United States, I ask him to send a copy of the Hansard that includes his excellent speech to the governor of Virginia, or some other similar person, with his fraternal good wishes and the respect of Parliament.

Mr. Patten: With the leave of the House. I shall certainly ensure that as soon as they are available, copies of Hansard are sent, through the usual channels, in the direction that my hon. Friend has suggested.

Question put and agreed to.

Adjourned accordingly at eleven minutes to Twelve o'clock.